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The Story 

of the 

Trust Companies 



By 

Edward Ten Broeck Perine 



Illustrated 



G. P. Putnam's Sons 

New York and London 

Gbe frnfckerbocfter press 

1916 



^ A £\ 



Copyright, 1916 

BY 

EDWARD TEN BROECK PERINE 



iyz 



DEC 14 1916 

Ube Ifcnlckcrbocfcer press, flew jjorft 



i C |.A446798 



Co 

MY FRIEND OF MANY YEARS 

JAMES HERBERT CASE 



FOREWORD 

Trust companies are a modern development. 
Their literature, as revealed in the bibliography 
at the close of this volume, has been of limited 
scope, although statistics have now been avail- 
able for some years and the legal aspects and 
technical methods of operating the companies 
have had bestowed upon them a considerable 
degree of attention. The present book is 
intended, with an avoidance of technicalities, 
to sketch the beginnings and advances of the 
older companies, and to bring the individual 
narratives of a number of the largest institutions 
down to 1 91 6, — a point within one hundred 
years of the original announcement by an 
American corporation of an intention to trans- 
act a trust business. 

In most localities there are well defined 
differences between banks and trust com- 
panies. The former serve their clients as 
depositories and extend credit in proportion 



vi Foreword 

to the accounts thus handled, the general rule 
being not to pay interest on deposits belonging 
to those who are borrowers. Many trust 
companies, particularly in the smaller com- 
munities, follow the same practice, but their 
usual function is as the holders of moneys not 
actively employed for commercial purposes; 
on these sums interest is paid; when they 
are withdrawn it is frequently for permanent 
investment. Their so-called trust powers com- 
prise the registering and transferring of stock, 
the certification of corporate bonds, appoint- 
ment to act as executor, administrator, trustee, 
committee, agent, and in almost every ca- 
pacity in which individuals might act with the 
more limited ability of individuals. 

One author has said of the trust companies 
that they are the department stores of finance. 
It is an apt metaphor, for the service they ren- 
der in these times, and the skill and common 
sense demanded of their managements are exact- 
ing to a degree greater than in almost any other 
line of business activity. Their history de- 
serves to be written, and although it has been 
necessary to omit references to many hun- 



Foreword vii 

dreds of institutions of less size than those whose 
names have been woven into the following text, it 
is, nevertheless, due them to say that each has 
its honorable part in a line of endeavor in which 
the test is not merely dollars piled up, but a 
good name. 

The author owes much to the other writers 
mentioned herein. Thanks are also due for 
the generous help given by trust company 
officials everywhere who have aided in gather- 
ing and assembling specific facts, figures, and 
illustrations. Of the last named, those which 
serve as a reminder of the old days when trust 
companies put out their own circulating notes 
have been furnished from a splendid collection 
of paper money made by Mr. David Proskey 
of the New York Coin & Stamp Company. 
This is true of each of the facsimile notes, 
except the little Fairfield Loan & Trust Com- 
pany's half-dollar of scrip, which has been 
kindly loaned by Mr. Wayte Raymond of the 
United States Coin Company of New York. 

E. T. P. 

New York, September 30, 19 16. 



CONTENTS 



PAGB 
FOREWORD V 

CHAPTER I 

Events prior to and during 1812; An address from the 
President and Trustees, Pennsylvania Company 
for Insurances on Lives and Granting Annuities; 
Farmers Fire Insurance & Loan Company, the 
first incorporation with trust powers . . 1-17 

CHAPTER II 

Events following 1822; New York Life Insurance & 
Trust Company, the first incorporation with 
"trust" in title; Its organization; Early reports 18-31 

CHAPTER III 

Banking expansion; Warnings in the public prints; 
Re-incorporation of Farmers' ; Re-incorporation of 
Pennsylvania Company ; Incorporation of Girard_ 32 -52 

CHAPTER IV 

Bank statistics of 1835; Ohio Life Insurance & Trust; 
Southern Life Insurance & Trust; Fairfield, Con- 
necticut Loan & Trust Company; Panic of 1837; 
First convention of American bankers . . 53-65 

ix 



x Contents 

CHAPTER V 

PAGB 

New York State Free Banking Act and its consequen- 
ces; New York State trust companies incorporated 
under Free Banking Act; Invasion of Wall Street by- 
out-of-town concerns; "The Wall Street Chorus"; 
Supervision by Comptroller at Albany; Office of 
Superintendent of Banks established at Albany; 
Buffalo and Philadelphia trust companies; Early 
litigation; Magazine comment of 1854 . . . 66-82 

CHAPTER VI 

Incorporation of United States Trust of New York, 
x 853; Test of constitutionality of its charter; 
Early reports; An auction sale of property held 
under a receivership; American Bible Society 
Trusteeship . . . . . . 83-94 

CHAPTER VII 

Failure of Ohio Life Insurance & Trust; Panic of 1857; 
Incorporation of Merchants' Loan & Trust of 
Chicago .... . . . 95-106 

CHAPTER VIII 

Six pioneers described since 1865: Farmers'; New York 
Life; Pennsylvania Company; Girard; United States 
Trust; Merchants' of Chicago; Some functions and 
illustrative appointments. .... 1 07-121 

CHAPTER IX 

Union of New York; Provident Life & Trust of Phila- 
delphia; Fidelity of Philadelphia; Brooklyn Trust; 
Rhode Island Hospital Trust; A Bankers Directory 
of 1868 122-138 



Contents xi 

CHAPTER X 

PAGE 

Citizens Savings & Trust of Cleveland; New England 
of Boston; Philadelphia Trust; Union of Chicago; 
Illinois Trust & Savings; Panic of 1873; Boston 
Safe Deposit & Trust ; Central of New York . 139-1 52 

CHAPTER XI 

Supervisory legislation; Lack of early figures; Report by 
New York State Superintendent of Banks; First 
Tabulation by Comptroller of the Currency; Real 
Estate Loan and Trust of Washington, D. C; 
Inactivity from 1876 to 1880 . . . 153-165 

CHAPTER XII 

Metropolitan of New York; Title Guarantee & Trust 
of New York; Land Title & Trust of Philadelphia; 
Lawyers Title Insurance of New York; Fidelity of 
Newark; Industrial of Providence; Franklin of 
Brooklyn ...... 166-182 

CHAPTER XIII 

New York Trust; Union of Pittsburgh; Security Trust 
& Savings of Los Angeles; Continental and Com- 
mercial of Chicago; Old Colony of Boston; Missis- 
sippi Valley of St. Louis .... 183-194 

CHAPTER XIV 

Guaranty of New York; Contrast of 1896 and 19 16 
aggregates; Panic of 1893; United States Mort- 
gage & Trust of New York; Union of San Francisco; 
Cleveland Trust; Canal Bank & Trust of New 
Orleans; Mercantile of St. Louis; Commercial of 
Jersey City 195-214 



xii Contents 



CHAPTER XV 

PAGB 

Growth in the new century; "Trust Companies" — 
Magazine; Equitable of New York; Empire of New 
York; Central of Chicago; First Trust and Savings 
of Chicago; Bankers of New York; Baltimore 
and San Francisco fires .... 215-230 



CHAPTER XVI 

Panic of 1907; Re-opening of Knickerbocker Trust; 
Columbia Trust of New York; Astor Trust of 
New York; Foreign companies . . . 231-241 



CHAPTER XVII 

Savings Union Bank & Trust of San Francisco; Los 
Angeles Trust & Savings; German American 
Trust & Savings of Los Angeles; Commerce of 
Kansas City; Hibernia Bank & Trust of New 
Orleans; Northern of Chicago; Harris Trust of 
Chicago; Chicago Title & Trust; Hibernian Bank- 
ing Association of Chicago; Guardian Savings & 
Trust of Cleveland; Union Savings Bank & Trust 
of Cincinnati; Fidelity Title & Trust of Pittsburgh; 
Colonial of Pittsburgh; Mercantile Trust & Deposit 
of Baltimore; Commercial of Philadelphia; Roches- 
ter Trust & Safe Deposit; Security of Rochester; 
Trust & Safe Deposit of Onondaga, Syracuse; 
Hudson Trust of Hoboken; Trust Company of 
New Jersey, Hoboken; Broadway Trust of New 
York; Peoples of Brooklyn; Kings County of 
Brooklyn; American of Boston; State Street of 
Boston; Commonwealth of Boston . . 242-262 



Contents xiii 



CHAPTER XVIII 

PACK 

Trust Company Section, American Bankers Associ- 
ation, Origin; Annual meetings; Recent accomplish- 
ments; Social features; Official arrangements . 263-275 

CHAPTER XIX 

Personnel, men in public life; Merchants and manu- 
facturers; Professional men; Private bankers and 
capitalists; Corporate bankers . . . 276-287 

CHAPTER XX 

Suspensions and failures; The reserve question in 
New York; Admission of trust companies to New 
York Clearing House; Statistics of recent years 1 288-299 

APPENDIX "A" 

Aggregate resources and liabilities of seventy 
Leading Companies, shown comparatively for 1906 
and 1916 300-307 

APPENDIX "B" 

Bibliography 308-312 

Index 313 



ILLUSTRATIONS 

PAGE 

Corner of Wall and William Streets, 1800. 
No. 34 (old number) in center, first home 
of The Farmers' Loan and Trust Com- 
pany, the oldest loan and trust institution 
in America .... Frontispiece / 

Handwritten Index of " Political Pamphlets." 
A collection made by Thomas Jefferson 
about 18 1 5, containing (No. 4) a reference 
to the first literature issued by The 
Pennsylvania Company for Insurances 
on Lives and Granting Annuities . . 8 

The earliest announcement of a company 
with power "to execute trusts" in a cor- 
porate capacity. From the New York 
Evening Post, August 6, 1822 ... 14 

A circular issued about 1836, describing 

Benefits of Life Insurance ... 46 

An interest bearing note for 50 cents. Issued 

in Connecticut, 1837 .... 60 

A one dollar bill of a New York trust com- 
pany. Issued in 1841, under the "Free 

Banking" Act 68 

xv 



xvi Illustrations 



Stock certificate issued in Mobile under a 

charter dated early in 1 836 ... 72 

Specimen of unissued circulation as originally 
held in the custody of the Comptroller of 
New York State 78 

The first home of The Merchants' Loan & 
Trust Company. Corner of La Salle and 
South Water Streets, Chicago . . I04 > 

The New York Stock Exchange, and office of 
the New York Guaranty & Indemnity 
Company, Broad Street, 1866 . . 108 

No. 408 Chestnut Street, Philadelphia. 
Office of the Girard Trust Company, 1850 
to 1872. From original in Historical 
Society of Pennsylvania. . . .114 

Broadway, New York, 1834, from Cortlandt 
Street to Wall Street. The site occupied 
later by the Union Trust Company, at 
No. 73 Broadway, was directly below 
Trinity Church . . . . .124 

Bond issued in 1876 by the Real Estate Loan 

& Trust Company of Washington, D. C. . 164 

Growth of the Guaranty Trust Company of 
New York, June 30, 1892- June 30, 19 16, 
inclusive . . . . . . 199 



Illustrations xvii 



The old Sugar House and Middle Dutch 
Reformed Church (occupied as Post 
Office 1845-1877), Nassau and Liberty 
Streets, New York, 1830. Site of the 
Mutual Life Building and home of the 
United States Mortgage & Trust Com- 
pany . . . . . . . 204 

Wall Street, about 1834, looking east from a 
point opposite the site of present Bankers 
Trust Company Building. Merchants' 
Exchange (with dome) at the right . . 224 

State Street, Boston, 1849. From original 
print in the main office of the State Street 
Trust Company . . . . .260 

A Modern Building. Home of America's 
largest trust institution, the Guaranty 
Trust Company of New York. South- 
east corner of Broadway and Liberty 
Street ...... 298 



The Story of 
The Trust Companies 



CHAPTER I 



THE BEGINNINGS. 1 822. FARMERS FIRE 
INSURANCE & LOAN COMPANY 

Corporate banking in the United States 
dates back to the days of the Continental 
Congress. In 1781 that body granted a charter 
to the Bank of North America. This institu- 
tion, now with the powers of a National Bank- 
ing Association, is still in business in Phila- 
delphia, having reached the one hundred and 
thirty-fifth anniversary of its incorporation on 
May 26, 1916. 

We are accustomed to consider that the 
earliest establishment of trust companies oc- 
curred many years after the founding of the 



2 Story of Trust Companies 

first banks. This is so, but in point of corporate 
age several State banks which have been re- 
organized as trust companies in comparatively 
recent years are nearly as old as America's 
earliest bank. The best illustration of this is 
the Union Bank & Trust Company of New 
London, Connecticut, claiming existence in 
both financial fields since 1792; while eight 
years thereafter, in 1800, the present Wash- 
ington Trust Company of Westerly, Rhode 
Island, was organized, also as a State bank, 
and in 18 10 the Farmers Bank of Lancaster, 
Pennsylvania, started a business which even- 
tually, almost a century later, came to bear the 
name Farmers Trust Company of Lancaster. 
Two years afterwards, on March 10, 18 12, a 
decade before the vital statistics of the trust 
companies might be said to have begun, Gover- 
nor Simon Snyder approved the charter of 
The Pennsylvania Company for Insurances on 
Lives and Granting Annuities. Trust powers 
were not at once conferred upon this Phila- 
delphia institution, but it was the first of several 
prominent concerns destined later to broaden 
into the business of full-fledged trust companies. 



Early Nineteenth Century Events 3 

Before chronicling the circumstances of this, 
and of subsequent incorporations in the same 
field of financial activity, a glimpse should be 
had of current conditions and events. By 
1 8 12, twenty- three years had elapsed since 
Washington was inaugurated as the first Presi- 
dent of the United States. He had then been 
dead twelve years, but John Adams, Thomas 
Jefferson, and eight other signers of the Declara- 
tion of Independence were still living, while 
James Madison was serving his first term as 
Chief Magistrate of the Nation. In those 
remote days there were living thirteen suc- 
ceeding Presidents, down to and including Lin- 
coln and Johnson. The same was true of 
certain other Civil War figures, like Jefferson 
Davis and Robert E. Lee, but Generals Grant, 
Sherman, Sheridan, and McClellan, as well as 
most of the other heroes of that war, had not 
yet been born. Only four States, Kentucky, 
Vermont, Tennessee, and Ohio, had been joined 
to the original thirteen. The population of 
these seventeen was approximately seven mil- 
lions of people. 

Such were some of the political conditions 



4 Story of Trust Companies 

of the Republic in 1812, when this forerunner 
of a Philadelphia trust company was formed 
for purposes of "insurances on lives and grant- 
ing annuities." In the same city, in 1793, the 
United States Mint had been established, less 
than twenty years before; in 1800, Congress 
had met there for the last time before removing 
to Washington; in 181 1, the charter of the first 
Bank of the United States had just expired; 
and during May, 18 12, Stephen Girard opened 
his celebrated "Banking House.' ' 

Five years previous to this time, New Yorkers 
had seen the Clermont embark on her maiden 
trip up the Hudson, while in the year 18 12 was 
witnessed the completion of their new City Hall. 
At this period New York's banks numbered 
less than ten, including the City Bank, char- 
tered in the year mentioned. Louisiana had 
been purchased in 1803, nine years before; 
only in 1809 had St. Louis become an incorpo- 
rated town; and during 18 12 the first rolling 
mill in Pittsburgh was erected. 

But the event which bore most upon the 
fortunes of the newly founded "Pennsylvania 
Company " was the breaking out of hostilities 



Outbreak of War in 1812 5 

between the United States and Great Britain. 
Six days before its charter was signed, that is 
on March 4, 18 12, Jonathan Russell, our 
charge d'affaires at London wrote to Secretary 
of State Monroe: "I no longer entertain a hope 
that we can honorably avoid war." In the 
same month Congress authorized a 6 per cent, 
loan of $11,000,000; on June 12th war was 
declared; by July 1st customs duties were 
doubled; on August 19th the American frigate 
Constitution met and vanquished the British 
Guerriere. 

Stirring days indeed were these in which 
The Pennsylvania Company for Insurances on 
Lives and Granting Annuities came into being. 
Its aims and activities were naturally subjected 
to immediate handicaps. Not until June 10, 
1 8 13, did the newly formed company open its 
doors for business, and only in the following 
year was any substantial progress made upon 
its plans. 

In a lengthy circular, issued in 18 14, undoubt- 
edly the first piece of literature over the name 
of any company now engaged in trust business, 
the management presented 



6 Story of Trust Companies 

An Address 

From 

The President and Trustees 

Of 

The Pennsylvania Company 

For Insurances on Lives and Granting Annuities 

. To the 

Inhabitants of the United States 

Upon the Subject of 

The Beneficent Objects of that Institution, 

Philadelphia. 

Printed by 7. Maxwell & Company 

1814- 

The opening words of the circular are: 

"Fellow Citizens: 

"Among the various modes of alleviating 
the misfortunes and calamities of life, which 
have been adopted by the inhabitants of 
Europe, none has more deservedly engaged 
the attention of the enlightened and benevo- 
lent, than the establishment of institutions 
for Insurances on Lives and Granting An- 
nuities." 
Farther along, life insurance, annuities, and 



An Address on Insurance 7 

reversions are defined and illustrated, and the 
business of London companies is described 
as being "so extensive that in thirty- three 
years, from January, 1768, to January, 1801, 
they made 83,201 insurances on single lives 
alone, which is more than an average of 2500 
per annum." 

After presenting various rules, rates, and 
arguments the address announces: 

"The office of the Company is open daily 
between the hours of 9 and 3 o'clock, at No. 
72 South Second Street, in the City of Phila- 
delphia, where a Committee of the Directors 
sit three times a week to consider and decide 
upon the proposals which may be made to 
them. Letters directed to the President, 
post paid, will be expeditiously attended to 
and answer given to any inquiries which may 
be made respecting the terms and rates upon 
which the Company will transact business." 

The list of directors is also presented, con- 
sisting of the following names: President, 
Samuel Yorke; John Bohlen, Joseph Peace, 
John Claxton, Jacob Sperry, Cadwallader Ev- 
ans, Jeremiah Warder, Jr., Joshua Longstreth, 



8 Story of Trust Companies 

Condy Raguet, Charles N. Bancker, John 
Welsh, James Hemphill, William Schlatter, 
and Jacob Shoemaker, the last named bearing 
the title of Actuary. 

Among the treasures of the New York Public 
Library a copy of this quaint " Address" has 
reposed for many years. An added interest 
attaches to it from the fact that it was origi- 
nally a valued belonging of Thomas Jefferson. 
Sometime during 1815 the "Sage of Monticello," 
always interested in mathematical matters and 
himself the founder of America's decimal system 
of currency, gathered and had bound together 
a collection of eleven so-called Political Pam- 
phlets. Under this title, in handsome calf 
binding, the "Address to the Inhabitants of 
the United States" has lain for a full century. 
Amongst its companions are to be found 
titles like, "Cooper on Political Arithmetic," 
"Ingersoll on the Loan Bill, 1814," and "Thorn- 
ton on a Constitution for North and South 
America." The flyleaf of this volume contains 
an index of the pamphlets made in Jefferson's 
own handwriting. Under his eye were reviewed 
the Pennsylvania Company's "Tables," showing 



J Iff.aU $U*&* OfT+d ^M^JL€^iuk^ ?s 9 shm 

2f I W*i ****** #n^yi>*|i^/^»W^. 

/ W 

Handwritten index of "Political Pamphlets." A collection made by Thomas 
Jefferson about 1815, containing (No. 4) a reference to the first literature issued 
by The Pennsylvania Company for Insurances on Lives and Granting Annuities. 



Close of the War of 1812 9 

the expectation of life at ages one to ninety, 
as computed on six different experience bases, 
per calculations both in America and abroad, 
its "Rates" for $100 of insurance at different 
ages and for annuities based upon the lives of 
adults and children. By him in his library in 
Monticello was read, doubtless with studious 
care, the message set forth in the text of the 
"Address," including a pointed reference by 
the Company's founders to the problems of 
the year 18 12. 

For it would appear that little had been 
accomplished during that and the following 
year, the explanation being offered that — 

"at that period some untoward circumstances, 
among which was the expectation of a war, 
depressed, for the moment, the disposition of 
capitalists to embark in new enterprises, and 
the subsequent declaration of hostilities 
against Great Britain, rendered it advisable 
to withhold, for a time, any extraordinary 
exertions." 

General Jackson won his great victory at 
New Orleans in January, 18 15, and soon there- 



io Story of Trust Companies 

after, on February nth, the second war with 
England was concluded by the arrival in New 
York harbor of the British sloop of war Favorite f 
bearing a treaty of peace. 

A period of reconstruction ensued throughout 
the entire country. On April io, 1816, the 
Act of Congress establishing the second Bank 
of the United States was passed and specie 
payments were resumed. At once numerous 
other banks sought charters and commercial 
business began to flourish. By 18 19, however, 
a depression had set in. In that year the 
Government's expenditures, largely in reduc- 
tions of some thirty-six millions of dollars of 
war loans, proved to be in excess of receipts. 
Credit now began to contract, employment 
became insecure, and the country experienced 
its first panic. In 1820, a measure of recovery 
from these embarrassments was enjoyed, but 
in 1 82 1 customs receipts fell to thirteen millions 
of dollars, a sum ten millions less than the 
annual average of the previous five years, and 
business affairs again became greatly unsettled. 

These conditions naturally affected New York 
bankers and individuals, and the depression 



The First Trust Company n 

was marked in degree as the city had recently 
outstripped Philadelphia and grown to be the 
wealthiest and most populous American munici- 
pality. Nevertheless a group of business men 
there was not deterred, in 1822, from establish- 
ing the first company in the city, state, and 
nation ever to be clothed with legal authority 
to "execute any or all trusts in their corporate 
capacity.' ' 

This was the Farmers Fire Insurance & Loan 
Company, chartered February 28, 1822, now 
The Farmers' Loan & Trust Company of New 
York. The word "Farmers" as a part of the 
corporate title was availed of primarily for 
the reason that under the charter a business 
in rural mortgage loans was contemplated. 
It was a charter provision that the "corpora- 
tion shall have authority to make loans on the 
security of bonds and mortgages, or convey- 
ances of improved farms, houses, manufacto- 
ries, or other buildings." Moreover, Section 9 
of the charter provided for the choosing of 
twenty-one directors in the City and County of 
New York, with out-of-town representation on 
the board by six others, "one of whom, at least, 



12 Story of Trust Companies 

shall be selected resident in each of the great 
districts of this State." As time elapsed the 
Company was enabled through these up-state 
connections to have an important part in 
certain real estate developments which sought 
financial assistance from New York City. 

Back in the year 1794, Robert Morris, the 
financier of the American Revolution, just 
beginning a series of struggles to regain his 
lost personal fortunes, had disposed of the title 
to nearly four million acres of land in Western 
New York, known thereafter as the Holland 
Purchase. This title ran to the Holland Land 
Company, which established its noted Land 
Office where the settlement bearing the good 
old Dutch name of Batavia was created. As 
the years went by, early troubles with Indian 
chiefs like Red Jacket, Corn Planter, and others 
who had originally owned the land were suc- 
ceeded by dissatisfaction on the part of the 
farmers, and other settlers, whose contracts 
of purchase and mortgages, held by the Holland 
Land Company, proved to be more burdensome 
than the makers had anticipated. Finally 
these contracts and mortgages passed into 



A Business in Farmers' Loans 13 

other hands and the farmers in the western 
part of the State found that they would have 
to deal thereafter with a group of New York 
investors. 

Among the latter, the Farmers Fire Insur- 
ance & Loan Company came into possession of 
a large number of the obligations named, and 
encountered no little difficulty in securing their 
enforcement. For many years after the reor- 
ganization of the Company under its new title, 
in 1836, communication was almost constant 
between the institution and various attorneys 
in the western counties. Only in comparatively 
recent times have the problems attending title 
searches in that part of the State ceased to 
require extended attention by the officers of 
the Farmers' Loan & Trust Company, of old 
an actual and important holder of farmers* 
loans. 

The Company's first public announcement 
appeared in the New York Evening Post of 
August 10th, in the same year, and read: 

"The Farmers Fire Insurance & Loan 
Company. Incorporated with a capital of 



14 Story of Trust Companies 

$500,000 — Office at No. 34 Wall-street, ad- 
joining the Bank of New York — open from 
9 o'clock a.m. to sunset. 

"This Company is now ready to receive 
proposals for insuring property of every 
description against loss or damage by fire. 
The terms will be as favorable as those of 
any other company in this city, allowing 
liberally for circumstances tending to diminish 
the risk. 

"This Company also has power granted to 
them, 'to receive, take, possess, and stand 
seized of any and all property that may be 
conveyed to them in trust, and to execute 
any and all such trust or trusts in their 
corporate capacity and name, in the same 
manner and to the same extent as any other 
trustee or trustees might or could lawfully 
do.' The trust property will be kept, as 
their charter prescribes, wholly separate 
from all other concerns of the Company, and 
cannot, in any event, be made liable for its 
losses or engagements. Any property so 
committed to them in trust, will be in- 
vested in such manner as the grantors may 
chuse [sic] to direct. 

"The public will readily perceive, that the 
advantages of this Company to protect pro- 
perty for the benefit of infants or others, or to 



THE FARMERS FIRE INSURANCE AND 
LOAN COMPANY. 

INCORPORATED with a capital of $500,- 
000- Otfice at No 34 WaU-sstreet, adjoining 
ihe bank of New-York— open from 9 o'clock, A. 
M. to sunset 

This Company is now ready to receive propo- 
lis for insuring property of every description 
igatnst loss or damage by fire. The terms will 
* as favorable as those of any other company in 
his city, allowing liberally for circumstances 
ending to diminish the risk. 

This Company also have power granted to 
hem, " to receive, take, possess, and stand seized 
)fauy and all property that may be conveyed to 
hem in trust, and to execute any and all such 
rRwsr or trusts in their corporate capacity and 
lame, in the same manner, and to the same ex- 
ent as any other trustee or trustees migty 
>r could lawfully do." The trust properti 
will be kept, as their charter prescribes, wholly, 
ieparate from the other concerns of the company, 
md cannot, in any event, he made liable for its 
osses or engagements. Any property so commit- 
ed to them in trust, will be invested in sUch 
nanner as the grantors amy chuse to direct. 

The public will readily perceive, that the ad- 
'antages of this Company to protect property for 
he benefit of infants or others, or to answer any 
peciaJ purposes, either of a pubhie or private na • 
ure, are far greater than those of individual ex- 
culors or otter trustees, who are alwavs liable 
o casualties, which no fore right can guard against 
r prevent; as the numerous and frequent appli- 
ations to the court of chancery for filling up of 
acancies occasioned by death, insolvencies, or 



j other causes, most incontestably show: and the 
| expenses of such proceedings often swallow np a 
j great part of the Trust Estate. By placing such 
I property in the charge of this company, who hate 
\ continued successv n, there can be no danger 
j whatever of any such casualties, as all such pro- 
iperty will be invested either at discretion in the 
I mo.c beneficial manner, for the sole advantage of 
j ihe party conveying the same, or invested as the 
party may direct, within the strict provisions of 
} any such trust. 

The Company refer, for further information 
upon this subject, to their charter, a copy of 
which may be had by application at the office, 
where also the terms for any trust estate mav be 
known. 

DIRECTORS. 
James M'Bride 



RESIDENT 
j Richard Han-on 
j James Magoe 
\ George Griswold 
Benjamfn Marshall 
C. C. Cambrelcng 
James D'WoIf, Jun. 
j Henry Wheatort 
Gabriel L- Lewis 
Henry Mactier 



A. H. Lawrence 
Benjamin Bailey 
Thomas Franklin 
John Johnston 
Thomas S. Townsend 
Francis Saltus 
William W. Rossel 
Frederick A. Tracy 



NON-RESIDENT DIRECTORS 

Southern District — James Tallmadgc, Pough- 
keepsle ; Christian Schell, Rhinebeck. 

Middle District — William James, Albany. 

Eastern District— Jphn L. Viele, Wateriord. 

Western District—George Andrus, Adams, 
Jetltrson county ; David White, Pa Imyr a Onta- 
rio county. 

JOHN T. CHAMPLIN, President. 
Jtrchibgld Melntyre, Secrttary. 

ang 6 



Earliest announcement of a company with power " to execute trusts " in a corporate 
capacity. From the New York " Evening Post," August 6, 1822. 






The First Advertisement 15 

answer any special purposes, either of a public 
or private nature, are far greater than those 
of individual executors or other trustees, who 
are always liable to casualties, which no fore- 
sight can guard against or prevent; as the 
numerous and frequent applications to the 
court of chancery for filling up of vacancies 
occasioned by death, insolvencies, or other 
causes, most incontestably show; and the 
expenses of such proceedings often swallow up 
a great part of the Trust Estate. By placing 
such property in the charge of this Company, 
who have continued succession, there can be 
no danger whatever of any such casualties, 
as all such property will be invested either 
at discretion in the most beneficial manner, 
for the sole advantage of the party conveying 
the same, or invested as the party may 
direct, within the strict provisions of any 
such trust. 

"The Company refer, for further informa- 
tion upon this subject, to their charter, a 
copy of which may be had by application at 
the office, where also the terms for any trust 
estate may be known." 

Appended to this advertisement were the 
names of eighteen Resident Directors, as 



16 Story of Trust Companies 

follows: " Richard Hanson, James Magee, 
George Griswold, Benjamin Marshall, C. C. 
Cambreleng, James D'Wolf, Jr., Henry Whea- 
ton, Gabriel L. Lewis, Henry Mactier, James 
M'Bride, A. H. Lawrence, Benjamin Bailey, 
Thomas Franklin, John Johnston, Thomas S. 
Townsend, Francis Saltus, William W. Russel, 
Frederick A. Tracy." 

This list was augmented by the names of 
six out-of-town directors, and those of the Presi- 
dent and the Secretary. These were: "James 
Tallmadge, Poughkeepsie ; Christian Schell, 
Rhinebeck; William James, Albany; John L. 
Viele, Waterford; George Andrus, Adams, 
Jefferson County; David White, Palmyra, 
Ontario County; John T. Champlin, President; 
and Archibald Mclntyre, Secretary." 

This advertisement was continued day by 
day during the greater part of August, 1822, 
but before the end of that month a violent epi- 
demic of yellow fever was raging in lower New 
York. The result was an exodus of business 
concerns from the region affected. On Au- 
gust 27th the papers contained a notice 
reading : 



" Trust " as Part of a Title 17 

"Farmers Fire Insurance & Loan Company 

"The office of this Company is removed for 
the present from No. 34 Wall Street to No. 
15 Park Place. Applications through the 
medium of the Post Office, or otherwise, will 
receive prompt attention.' ' 

Three days later another announcement 
appeared stating that the Company's quarters 
had again been removed, still farther uptown, 
the new address being given as "618 Broadway, 
two doors above the Branch Bank." 

The continuing fortunes of this pioneer among 
trust institutions in the United States will be 
narrated in subsequent chapters, but the read- 
er's attention is next invited to an account of 
the first company to be formed with the word 
"trust" included as part of a corporate title. 



CHAPTER II 

I83O. NEW YORK LIFE INSURANCE & TRUST 
COMPANY 

The years just preceding and following 1822 
witnessed numerous developments of importance 
in the country and many of its political subdi- 
visions. The population had grown by 1820 to 
upwards of nine millions and a half; its center, 
however, was no farther west than a point within 
the State of Virginia. Louisiana was admitted 
to statehood in 18 12, Indiana in 18 16, Missis- 
sippi, Illinois, Alabama, Maine, and Missouri 
in the successive years from 1817 to 1821. 
The State last named brought the total in the 
Union up to twenty-four. In the spring of 
181 6, Pittsburgh was incorporated a city; on 
July 4, 1817, ground was broken for the Erie 
Canal; and in the same year the first line of 
packet ships was established between New York 
and Liverpool, while a steam ferryboat had 

18 



Some Contemporary Events 19 

first plied the East River between New York 
and Brooklyn three years earlier. In 1818, 
the steamboat Walk-in-the~Water, sailing from 
Buffalo, arrived at Detroit; 18 19 saw steam 
navigation undertaken between New Orleans 
and St. Louis, and in the same year came a 
slowly reported account of the safe passage 
across the Atlantic of the steamship Savannah. 
Also, in 1 819 Cincinnati became a city, and in 
1820 petroleum springs were first discovered in 
the State of Ohio. 

In New York City the first savings institu- 
tion, the Bank for Savings, was opened on 
July 3, 1 8 19, and so entered that field three 
years before the Farmers Fire Insurance & 
Loan Company was organized for trust business. 
New York's only theater, the Park, was de- 
stroyed by fire and rebuilt in 1821. Shortly 
afterward, in 1824, a great celebration took place 
in New York on the occasion of General La- 
fayette revisiting America. The year 1825 was 
notable for the completion and opening of the 
Erie Canal ; also the first railroad, the Mohawk 
and Hudson, was chartered, and, as illustrations 
of other developments following close upon the 



20 Story of Trust Companies 

beginnings of trust company operations in the 
Metropolitan City, it may be noted that 
in 1825 the Gothamites, as they had been 
dubbed by Washington Irving eighteen years 
before, first made use of illuminating gas, first 
attended Italian opera, and enjoyed the innova- 
tion of a Sunday newspaper. Within the ten 
years following 1820 such private institutions 
were organized as Bloomingdale Asylum, the 
Hebrew Benevolent and Orphan Asylum, the 
Eye and Ear Infirmary, the New York Bible 
Society, the American Tract Society, the 
National Academy of the Arts of Design, the 
Seamen's Friend Society, and the American 
Institute. 

During 1829 the first railroad locomotive 
was run and in the following year came another 
innovation in the form of an institution styling 
itself a "trust company."^ 

Similarly to all such enterprises begun within 
the early years, this concern cautiously laid 
plans with more than one string to its bow and, 
whereas the " Farmers Fire" had already estab- 
lished itself in the field of both underwritings 
and trust undertakings, the founders of this 



The Second Incorporation 21 

newer concern set out to perform a dual func- 
tion as well, calling their institution the "New 
York Life Insurance and Trust Company." 

The charter was secured on March 9, 1830, 
after a considerable amount of heated debate 
had occurred at Albany involving the pros and 
cons of so unusual an enterprise. The author- 
ized capital was one million dollars and the 
trust powers conferred upon the company were 
very similar to those heretofore shown for 
the Farmers Fire Insurance & Loan Company. 
The charter constituted thirty trustees as a 
board, and an inspection of their names will 
show how representative a group of New York 
business men was thus identified with the new 
Company. The trustees were: William Bard, 
Stephen Van Rensselaer, Isaac Bronson, James 
Kent, Gulian C. Verplanck, Abraham Blood- 
good, Edward R. Jones, John Jacob Astor, 
Saul Alley, John Duer, Robert Lenox, Walter 
Bowne, Nathaniel Prime, Philip Hone, Peter 
Augustus Jay, John Mason, Peter Lorillard, 
Thomas W. Ludlow, William B. Lawrence, 
Jonathan Goodhue, Samuel Thompson, William 
James, Peter Remsen, Isaiah Townsend, Ben- 



22 Story of Trust Companies 

jamin Knower, Stephen Whitney, Benjamin 
F. Butler, Thomas J. Oakley, Edward C. 
Delavan, and Garrit Storm. 

An organization meeting of these trustees 
was held on April 12, 1830, at the Merchants' 
Exchange and William Bard was chosen Presi- 
dent. Notice was shortly afterward given 
that a committee would open the books and 
receive subscriptions for the stock. This latter 
event occurred on the 7th of May. A resolu- 
tion was passed providing that the incorpora- 
tors, those named above with thirty-one others, 
might subscribe in each case for one hundred 
shares of the stock of the Company, which 
consisted of ten thousand shares, each of a par 
value of one hundred dollars, making a total 
of one million dollars. It was further stipu- 
lated that no person would be allowed to sub- 
scribe for more than one hundred shares and 
that the incorporators' subscriptions should 
be given first consideration, after which a distri- 
bution to outsiders should be made by lot, 
that is, "by drawing the letters," meaning 
letters of application. In this respect no 
thought seems to have been given to the modern 



Advertisements of 1830 23 

method of stock allotments in the discretion 
of committees, with the frequently availed of 
privilege of "rejecting any or all applications." 
On April 226. an advertisement appeared 
informing the public that the Company's busi- 
ness would be conducted in the East Room of 
the City Bank, opposite the Merchants' Ex- 
change. Calls were made for 10 per cent, of 
the stock subscriptions and notice was given 
that, according to the seventh section of the 
charter, 

"the whole of the capital is to be invested, 
in bonds and mortgages on unencumbered 
real estate within the State of New York, 
and at least one-half thereof shall be con- 
stantly invested on real property within the 
limits of the City and County of New York." 

This advertisement concluded with the words: 

"N. B. The Editors of Country papers who 
may think the above important to their 
subscribers, may, if they think proper, insert 
the above in their papers. Letters to the 
President must be post paid." 

On Saturday, May 8th, the New York Even- 
ing Post gave the Company a lengthy editorial 



24 Story of Trust Companies 

notice, undoubtedly the first of its kind ever 
to appear. Among other things set forth in 
this article was the fact that the sixty-one 
incorporators had each taken his allotment of 
stock, making a total at par of $610,000. The 
editorial continued: 

"Applications were received for about 
$12,000,000, against which only $390,000 
could be l distributed this morning by lot- 
tery/ and as five per cent, premium was 
offered for it by the Brokers yesterday, 
there was great anxiety manifested to ascer- 
tain who were the fortunate persons who 
had drawn prizes. The result was made 
known about 12 o'clock by posting the names 
in the different bulletin offices. There were 
about thirty-one blanks to a prize. The 
stock was sold this day at the Board of 
Brokers for six per cent, advance." 

The editor of the Post completed his descrip- 
tion of these transactions by inquiring : 

"Does the eagerness with which this stock 
has been sought for indicate anything but a 
disposition for speculation? Or is it an evi- 
dence of money being plenty in our market 



Stock Quotations 25 

and of a desire to make investments which 
will yield a fair interest?" 

Two days later, on May 10th, there were 
local stock-exchange quotations published, cov- 
ering seven different issues. Save for 150 shares 
of United States Bank, ranging from 130 J/g 
to 130^, no other stock was reported at as 
high a price as 255 shares of "Life Insurance 
and Trust Company" at 106^. On June 
28th, a lengthy statement was published in the 
name of the trustees who gave " notice to 
the public that they are ready to commence the 
business which by their charter they are author- 
ized to transact." The features of the pro- 
posed business were described as follows: 

"They will insure lives and purchase and 
sell annuities. They will receive money in 
trust, pay interest thereon and accumulate 
the same. A third branch of business will 
extend to the acting as trustees under last 
wills and testaments, as guardians of estates 
of infants, as receivers of the property and 
effects of insolvents and dissolved or sus- 
pended corporations, as the committee of 



26 Story of Trust Companies 

the estates of lunatics and as assignees for 
the benefit of creditors." 

Curiously enough the management laid out, 
from the very beginning, a policy of paying 
interest on deposits, a practice which in years 
to come was to involve the banks and trust 
companies of the entire country in a question 
of conflicting opinion as to their respective 
functions. Probably the thought of these early 
trust company founders was not directed to- 
ward competition with the banks, but their 
notice of the early summer of 1830 distinctly 
specified that — 

"The Company will receive money in 
trust, and issue certificates therefor, on the 
following conditions. No deposite shall be 
received under one hundred dollars, nor shall 
any sum less than that amount be drawn un- 
less as the balance of an account. All moneys 
deposited in trust for a shorter time than 
one year shall be deposited for a certain 
number of months, not less in any case than 
two months from the date of the deposite. 
Interest at the rate of three per cent, per 
annum will be allowed on moneys not de- 



Interest on " Deposites " 27 

posited for a longer term than four months. 
Where the term shall exceed four months 
and be less than a year, four per cent, will 
be allowed. Where the deposite shall exceed 
a year, the rate of interest shall be settled by 
special agreement. In all cases where the 
moneys in trust shall not be withdrawn at the 
expiration of the period for which they were 
deposited in trust, they shall remain with 
the Company for another period of not less 
than thirty days, and be allowed the same 
interest as if originally deposited for the 
extended period. Where the trust shall 
exceed a year, interest may be made payable 
before the principal shall become due, annu- 
ally, half yearly, or quarterly, as may be 
agreed on. Where the trust shall be for a 
shorter period than a year, no interest will 
be paid until the principal shall become due." 



Such were the beginnings of the second Ameri- 
can trust company. Its charter contained 
several unusual requirements. One of these 
provided that the trustees shall elect their suc- 
cessors, another that the trustees must in all 
instances be citizens of the State of New York. 
In 1830 the City Bank purchased the site 



28 Story of Trust Companies 

of the old United States Bank at No. 40, now 
52, Wall Street, erected in 1791. Here the 
trust company took up its quarters, and in the 
trustees' room there is still preserved to-day 
the cornerstone of the former bank building. 

An order was issued by the Chancellor of 
the State of New York under date of Novem- 
ber 19, 1 83 1, requiring the trustees to pre- 
sent a statement from year to year showing 
their "situation and affairs." The Company's 
answers from year to year comprise a set of 
the earliest trust company reports extant. 
Eight years after the charter was given, on 
January 1, 1838, several interesting facts re- 
garding the Company's progress were recorded. 
Their $1,000,000 of capital was loaned out on 
bond and mortgage, none of which was in suit 
or judgment on which prosecution had been 
ordered. The Company had no other loans 
on bond and mortgage, aside from loans to 
moneyed corporations, or to their officers or 
agents, which amounted to $4,740,742.55. The 
total number of loans was 4079, of which thirty- 
two were being foreclosed, representing prin- 
cipal amounting to $57,307. The Company 



Loans on Stocks of Sister Companies 29 



had collateral loans amounting to $481,268.41, 
and in a list of collaterals showed, among the 
rest, some shares of three sister trust companies 
of which mention is to be made farther along. 
The lists contained these particulars: 



Name of Stock 


St3 


K 3 






American Life Insur- 
ance & Trust Co. 

Farmers' Loan & Trust 
Co. 

Ohio Life Insurance 
& Trust Co. 


$31,679-56 
24,423.51 
25,250.00 


764 

553 
280 


$50 

50 

100 


6% discount 
6% premium 
2% discount 



At this time the Bank of New York was 
quoted at 22 per cent, premium, the Man- 
hattan Company at 25 per cent, premium, and 
the Chemical Bank at 10 per cent, premium. 
Many of the fire insurance companies were at 
a discount, but the stock of the Utica Railroad 
Company was listed at 19 per cent, premium. 

It was stated that, "In the Company are the 
owners of the following stocks." Here followed 
a list of ten New York City banks showing that 



30 Story of Trust Companies 

the holdings of these investors were $i 1 1 ,442.96. 
The Company was said to own three farms 
taken under foreclosure, two in Oswego, and 
one in Erie County. 

The "deposites" held in trust were $3,194,- 
466.77. Although this was long before the 
days of reserve requirements, it seems a little 
strange to read that "the whole amount of 
money on hand the first day of January, 1838, 
was $35.56, being the balance laying in the 
Manhattan Bank, in which all the deposites 
of the Company are made." On this same 
date there was cash due from country banks, 
etc., amounting to $80,092.97. The books 
and office furniture were valued at two hundred 
dollars 

It was stated that : 

"the Company have received no money in 
trust to be invested at the risk and for the 
benefit of the persons for whom such moneys 
were received ; all moneys which have hitherto 
been received in trust are at the risk of the 
Company and under their management; 14 10 
life insurance policies have been issued, of 
which 706 remain in force; the youngest 



Other Developments of the Thirties 31 

age is twelve and the oldest seventy-one; 
the face of the policies represent $2,385,570; 
the officers and their salaries are: 

William Bard, President $5000 per annum 
Edward A. Nicoll, Secretary 4000 " " 

Chas. C. Palmer, Assistant Secretary 2000 " 
Philip R. Kearney, Clerk 1800 " " 

Joseph R. Kearney, Clerk 250 " " 

and the Company have surplus and undivided 
profits of $311,714.88." 

The later growth of the New York Life 
Insurance & Trust Company, continuing down 
to present times, will be hereinafter sketched. 
Next in our story, however, are to be related 
some facts respecting other developments of 
the thirties in the fields of banking, trust 
company, and related affairs. 



CHAPTER III 

I836. FARMERS' LOAN & TRUST COMPANY. 

THE "PENNSYLVANIA COMPANY," AND 

THE GIRARD 

The decade beginning 1830 was marked by 
several interesting events. In the spring of 
1 83 1 the New York and Harlem Railroad, the 
country's first street railway system, was incor- 
porated. During the summer the Mohawk and 
Hudson Railroad was opened as a freight and 
passenger line; the launching of the famous 
steamship Great Western occurred in 1837; 
and in the same year a beginning was made in 
the line of express business. 

But as reminders of how early a period it was 
in which the trust companies were beginning 
to establish themselves, it should be stated that 
not until 1832 was Buffalo chartered as a city, 
and that Chicago only became an incorporated 
town in 1833. A year later, New York held 

32 



Expansion in Banking Affairs 33 

its first election of a mayor by the people, and 
in 1834 an d 1836 city governments were estab- 
lished for Brooklyn and Cleveland respec- 
tively while in 1838, Morse's invention, the 
telegraph, was being first exhibited and daguer- 
reotypes were being introduced in the United 
States. 

Despite the progress of these years, however, 
many grave financial problems were arising, 
and these came to a culmination in the disastrous 
failure of the Second Bank of the United States. 
President Jackson's controversies with Con- 
gress, and with the management of the Bank, 
began in 1829, and continued until the outbreak 
of the panic of 1837. 

The panic itself was preceded by a period of 
widespread expansion in the banking world. 
Governor Marcy of New York, in his message 
transmitted to the Legislature in 1834, reported 
that during the previous four years nine mil- 
lion dollars had been added to the banking 
capital of the State; also that 105 new banks 
had published notices of intention to organ- 
ize with aggregate capital of fifty-six million 
dollars. 



34 Story of Trust Companies 

He remarked: 

"Banks are now regarded as necessary 
establishments; but I cannot believe they 
are required to the extent now asked for. 
Banking privileges, not only as they are 
granted by this State, but as they exist in 
almost every country, are a monopoly which 
ought not certainly to be increased beyond 
the actual exigencies of the public." 

In the same message he advanced a theory 
which, to our modern view, sounds like an 
absurdity but which was probably not so 
utterly impractical in those days of over- 
extension of banking facilities. He said : 

"If any means could be devised to cause 
the stock to go into the hands of those to 
whom it is distributed, worth only its par 
value, I think there would be much less so- 
licitude for the increase of banks. Whatever 
value is given to the stock above the sum 
paid for it, in consequence of the franchise 
or peculiar privileges granted to the corpora- 
tion, may, upon any principles of justice, 
be withheld from the subscribers, and right- 
fully claimed by the State; and it is a cause 



Warnings Against Inflation 35 

of regret that some provision to effect this 
object had not long since been adopted." 

While admitting some objections to this 
plan — for example, that former applicants would 
have received advantages now to be denied to 
others of equal merit, he suggested that an 
effective mode of curbing the evils would be 
by withholding from the original owners the 
premium on bank stock, by making offers of the 
latter at public sale, and reserving to the State 
the advance above the par value. Against 
this the drawback was presented that such 
an arrangement would facilitate the concentra- 
tion of stock in the hands of a few wealthy 
individuals, while the desire of supplying the 
wants of an exhausted treasury, or of increasing 
a favorite fund, might possibly operate as an 
inducement to grant applications which would 
not be sustained on the ground of public utility; 
with the added objection that combinations 
by speculators at the sale might also prevent 
fair competition and engross the stock. Other 
suggestions by the Governor were a general 
reduction of interest on all loans and other 



36 Story of Trust Companies 

contracts, so as to make banking business less 
attractive, and the limitation in amount of 
circulating notes to a sum equal to the capital 
of each bank. 

The newspapers of 1836 were filled with 
headlines of warning against the inflation then 
taking place in the creation of new moneyed 
corporations. Some of these read "Banks! 
Banks!" and one editorial writer began an 
article by inquiring: "Are the people of this 
country really becoming bank mad?" Never- 
theless within this era of over-development 
there were several new departures in the line 
of trust business, and some of these, although 
they embarked upon a tempestuous sea, were 
fated to outride the perils of the thirties and 
sail prosperously on during all the years to come. 

That the Farmers Fire Insurance & Loan 
Company was prospering is to be seen from an 
advertisement published early in 1831, which 
announced : 

"The Board of Directors of this .company 
have this day declared a dividend of three 
and a half per cent, on the capital stock, 



Opinion Against " Farmers Fire " 37 

payable at their office on and after the third 
day of January next. The Transfer Book 
will be closed from the 24th inst." 



Its charter had been granted for a period of 
fifteen years, dating from 1822. Early in the 
year 1836, action was taken looking toward 
securing a renewal with a change of title to 
include the word "trust." Before this was 
accomplished a large amount of discussion took 
place regarding the doubted wisdom of trust 
company activities in general, and of the Far- 
mers' in particular. The public prints were 
opened to the debate; scathing denunciations 
appeared alleging the illegality of corporate 
appointments as receiver or guardian, when 
exercised by a "fire insurance company"; po- 
litical influences were complained of; the un- 
righteousness of most forms of current trust 
company enterprise was dwelt upon in a long 
series of protests and appeals addressed to the 
reading public. 

An article which appeared during this period 
over the signature "A Stockholder" is here 
copied from the New York Times (not however 



38 Story of Trust Companies 

the present daily, established some fifteen years 
later). It read: 

"Farmers Fire Insurance Company 

"A writer in the Journal of Commerce of 
Saturday last is guilty of a most impertinent 
interference in the affairs of this company. 
He takes, substantially, the ground that 
because the Farmers Fire Insurance Com- 
pany have the right to insure against fire, 
they are bound to continue that business 
against their own interests. This company 
has very large trust powers. They may 
'execute any trusts to the same extent and in 
the same manner as any trustee,' says the 
chapter expressly. This and other powers 
in the charter enables the company to receive 
money in deposite and to issue their bonds 
or certificates therefor redeemable years 
hence. This kind of business is much more 
profitable to the stockholders than the dan- 
gerous business of Fire Insurance and the 
directors of the company are entitled to the 
thanks of the stockholders for having dis- 
continued that branch of business, and 
developed the hitherto latent or dormant 
powers of the company to the great benefit 
of the publick. The Company has power to 



Protest Against Re-incorporating 39 

insure lives, though but little, if any, of this 
business has been transacted, on account of 
the charter's expiring next winter. The 
institution is so useful to the publick, and 
the managers of it so highly respectable and 
wealthy, and have so much political influ- 
ence, that there is no doubt the charter will 
be renewed and made perpetual this winter, 
and the name of 'Fire Insurance' stricken 
out. Now, is it not reasonable that a com- 
pany possessing these powers should not lay 
them aside, and go on with a Fire Insurance 
business? It is to be remembered that the 
Fire Insurance business is wholly incompati- 
ble with the business now carried on by the 
Company. 

"Who would deposite money with the 
Company, who would buy their bonds (and 
they have a half a million of dollars of bonds 
now in circulation, and as much more is 
soon to be out, redeemable in twenty years) 
if the Company continues the Fire Insurance 
business ? 

"Who if the Company is liable to be ruined 
in a single night by fire risks would take their 
grant of annuity for a term of years? 

"Who would sell the Company an annuity 
and take their bonds or other evidences of 
debt in payment ? 



40 Story of Trust Companies 

"Other Companies for Fire risks can be 
created, and this Company left to pursue 
the business most profitable to the owners of 
the -stock and quite as useful to the publick." 

This called forth an attack upon the Com- 
pany, then and now the oldest of its kind in 
the country, in the form of the following letter 
to the Evening Post: 

"From the tenor of this argument (quoting 
'Stockholder's ' letter) I presume it comes from 
the pen of some one of the managers of the 
institution who are stated to be so highly re- 
spectable, and wealthy, and to have so much 
political influence that there is no doubt 
the charter will be renewed and made perpetual 
this winter and the name of 'Fire Insurance* 
stricken out. Some of these most respectable, 
wealthy, and influential managers of this insti- 
tution have been suspected of having some- 
thing to do with the management of the able 
journal in which the communication of 'A 
Stockholder' appears. 

"The New York Life Insurance & Trust 
Company was chartered in 1830, with a 
capital of one million dollars, and who is 
there now in this community, except the 



Political Influence Charged 41 

persons interested in that institution, that 
does not regret it. The Farmers Fire 
Insurance and Loan Company, with a capital 
of two millions of dollars, claims substantially 
the same powers as the Trust Company, 
but they only want the legislature to be so 
kind as to grant them further privileges. As 
I am one of these unfortunate men who are 
opposed to all monopolies of this description, 
and happen to know something of this insti- 
tution, I feel disposed to make some little 
examination into its actual powers, and its 
claims to the favor and kindness of the repre- 
sentatives of the people. 

"The Farmers Fire Insurance & Loan 
Company was chartered for fifteen years on 
the 28th of February, 1822. On the 17th 
of April, 1822, an amendment to the charter 
was enacted conferring on the Company 
certain limited trust powers. For thirteen 
years the Company was content with the 
ample profits secured by their legitimate busi- 
ness of fire insurance, but after the N. Y. 
Life and Trust Company sprung into exist- 
ence, clothed with immortality and perfect 
freedom of action, the Farmers Fire Insurance 
and Loan Company began to feel the spirit 
of avarice and gain stirring within them. 
Three ineffectual attempts were subsequently 



42 Story of Trust Companies 

made by the President of the Company to 
prevail upon the legislature to amend the 
charter by striking out the name of 'Fire 
Insurance,' and making it a close corporation, 
the directors having power to perpetuate 
their own succession and existence in office 
independent of the stockholders, and accord- 
ing to the example of the New York Life In- 
surance and Trust Company. Within the 
last year, and since the death of that gentle- 
man, and with a view to the operations this 
winter in the legislature, much pains have 
been taken to select from the monopoly 
democrats throughout this state and city, 
such persons to share the plunder contem- 
plated to be seized in the name of this corpo- 
ration, as from their political standing with 
the democratick party were supposed to be 
most able to procure the legislation sought for 
in aid of the charter. Simultaneously with 
this measure of securing public influence, 
the capital has been increased to two mil- 
lion dollars, their legitimate business of fire 
insurance has been discontinued by a bye- 
law of the company, and fancying that an 
amendment of the 17th April, 1822, confers 
ample authority, all the energies of the 
company are now devoted to that description 
of business indicated by the published bye- 



A " Charmed" Corporation 43 

laws and advertisements of the Company; 
their main business being however the re- 
ceiving of money on deposit at a low rate 
of interest, issuing therefor 'certificates' of 
deposit, another name for post notes and 
bonds transferable and bearing interest, the 
whole operation being nothing else, substan- 
tially, than a revival, under the sanction of 
imposing names, of the reprobated business 
of the Bond Companies of the memory of 
1826. Application is now made, or soon 
will be, to the legislature to get rid of the 
name which the legislature gave the Company 
as a fire office, and for other material amend- 
ments in aid of the financial operations and 
brokerage now carried on by them. 

" Since the late calamitous fire, the mer- 
chants and other citizens of New York are 
destitute of insurance offices, except two or 
three companies with small capitals, and 
calculated only for the up-town business 
where they are located. The consequence 
is, that premiums of insurance to a large 
amount are now sent abroad, seeking policies 
in other cities, in the villages in all parts of 
the United States, and with the agents of a 
British Fire Company at Norfolk. Three 
times the amount of the former rates of 
insurance are now required to be paid by our 



44 Story of Trust Companies 

citizens, and to strange companies, of whose 
solvency they can know but little. Under 
these circumstances, the citizens naturally 
looked to the Farmers Fire Insurance Com- 
pany for relief, and it was for many days 
believed that in this dilemma that the Com- 
pany would not refuse to answer the end 
for which it was created, but keeping in view 
the object of their existence, would resume 
the business of fire insurance on fair and 
usual terms, to the manifest accommodation 
and benefit of the city. With a capital of 
two millions of dollars this company might 
supply, to a great extent, the wants of the 
city in respect to fire insurance. But dealing 
in money, stocks, and other securities, and 
issuing 'certificates' for the payment of 
money, proves so profitable that this corpora- 
tion is charmed away from its publick duty, 
and they shut the door in the face of citizens 
who ask for fire policies, and tell them 'the 
Company has declined that business.' This 
conduct on the part of the Farmers Fire 
Insurance and Loan Company has induced 
an examination of their charter, and an 
inquiry has been instituted as to the power 
of the company to carry on the business they 
propose to do in their advertisements, and 
which it appears by their bye-laws they are 



Re-incorporation of Farmers 45 

now transacting. But as this communica- 
tion might be inconveniently long, if you 
should think proper to publish it, I will defer 
the comments upon the charter and present 
them in another communication. Those 
comments will be founded upon the reasoning 
of opinions of two of the most able counsellors 
in this city. These opinions I have had an op- 
portunity to examine with care. If they were 
under my control I would present them en- 
tire ; and I shall not fail to give them as nearly 
and literally as I can recollect their terms. 
These opinions, I have been informed, have 
been examined and sanctioned by one of the 
ablest lawyers in the United States, and for- 
merly of this State. With these aids I pledge 
myself to show, that not one of the powers 
specifically claimed by 'A stockholder* for 
the company is found in their charter, — 
that if such latent and dormant powers be 
exercised, it is in violation of the charter 
and of the laws of this State; and that the 
advertisement of the company bears on its 
face statements calculated to mislead the 
publick. 

" (Signed) Amos." 

Notwithstanding this and like disputes, and 
denials of the consistency with which the 



46 Story of Trust Companies 

Farmers' managers had adhered to original 
charter provisions, the appeals to the "publick" 
and the attacks upon the monopolists of the 
"democratick" party came shortly to an end, 
and in 1836, on April 30th, the Company ob- 
tained its new charter and by virtue thereof 
assumed as its new title "The Farmers' Loan 
& Trust Company." 

The business was continued in Wall Street 
the capital was increased to two million dollars 
and was constantly advertised during the 
summer and fall of the year named as being 
"the largest of any similar institution in this 
State" and as "principally invested in bond 
and mortgage of real estate." The President 
of the reorganized institution was Henry 
Seymour; and its function of insuring fire risks 
now disappeared; an Actuary and a Physician 
were named upon the official list, and some 
life insurance business was transacted. 

As a matter of fact the only curtailment of 
powers under the new charter was a provision 
whereby the Company was no longer permitted 
to engage in the business of fire risks. But 
life policies were written in the early years 



LIFE INSURANCE. 

TO THOSE WHO, IN THE EVENT OF THEIR DEATH, WOULD MAKE 
PROVISION FOR THE SUPPORT OF THEIR FAMILIES. 



FARMERS' LOAN AND TRUST COMPANY, 

Of the City of New-York;, 
WITH A CAPITAL OF 2,000,000 DOLLARS, 

IS ENGAGED, INDEPENDENT OF ITS OTHER BUSINESS, 
IK THAT OF 

3LHIF31 EHS¥]SAIf(DMi 

The objects and benefits of which are, to afford mutual relief and 
maintenance to the widows, children, or friends of deceased in- 
dividuals, and to all who are, or may be, dependant upon the 
lives of others for a support. 

This Company will insure in sums not less than $100, nor 
exceeding $5,000, and for any term, whether it be for one or 
more years, or for the duration of life ; the premium to be paid 
to the Company, depending upon the term and the age of the 
party insured. For example ; — 

A person aged thirty years, wishing to secure to his wife or 
family, or friend, or any other person, a certain sum of money, 
to be paid them after his death, say a sum of $100, may do so by 
paying to the Company a premium of $2,^ every year during 
his life. Should he die immediately after effecting the insurance, 
the Company would pay the amount insured. 

Should the party wish the insurance to continue for a term of 
years only, say for seven years, the annual premium would 
only be $1,%. 

Should the term be for one year, the premium would be $1^. 

Should the age be less than thirty years, the premium would 
be less ; if over thirty years, the premium would be greater. 

An individual may also insure the life of another person, pro- 
vided he has an interest in that life to the amount insured : by 
which means a debt or any sum of money dependant upon the 
life of the insured may be secured. 

Life insurance, in addition to the benefits derived from those ex- 
cellent institutions, Savings Banks, is another and more effectual 
method of providing for the future welfare of relatives and friends: 
the advantages to be derived from it are attained with ease and 
certainty, and at a trifling cost. 



Money is also received by this Company in deposite, in trust, 
for any period over thirty days, and interest allowed on the same. 

Office of the Company, ) R. K. DELAFIELD, 

No. 34 Wall Street, > Actniary and Secretary. 

New York. \ 

Circular issued about 1836, describing Benefits of 
Life Insurance. 



An Early Insurance Policy 47 

following 1836, and one of the oldest of these, 
which was also the last to be surrendered and 
its amount paid to beneficiaries, hangs to-day 
in a frame on the wall of the Directors* Room. 
It bears date, " Thursday the 15th day of 
February, 1838." In the application which 
forms a part of the policy it was stated that 
the "sum to be assured is $2000/ ' Among 
questions and answers incident to the work of 
the medical examiner was set forth the printed 
query: "Has the party had the gout?" with the 
response written in: "He has not"; again, 
"Has the party had the smallpox?" the answer 
being: "He has not"; but to the query, "Has 
the party had the cowpox?" the reply was, "He 
has." 

The assured lived to be over ninety years of 
age, and paid his semi-annual premiums until 
a few years ago when, upon proofs of his death 
furnished the Company, a remittance was made 
to his heirs of two thousand dollars in full 
settlement of the above described contract. 

During the same spring of 1836 two notable 
events occurred in Philadelphia trust company 
history. On February 25th the charter of 



48 Story of Trust Companies 

The Pennsylvania Company for Insurances on 
Lives and Granting Annuities was supplemented 
by a grant of authority to enter into the busi- 
ness of executing trusts. Plans for this enlarge- 
ment had been in contemplation as far back as 
1 83 1, and Harrison S. Morris in his admirable 
Sketch of the Pennsylvania Company relates that 
the directors had regard to "the great success 
of what in India at this time were called agency 
houses, — concerns organized to transact busi- 
ness for trustees or individuals, to receive 
moneys on deposit, and to administer estates." 
His narrative shows that a committee early 
in 1 83 1 reported favorably upon the plan of 
engaging in the new form of business, and that 
the Board of Directors had on January nth 
resolved "to enter into the business of trusts/' 
directing "that the President, in conjunction 
with Horace Binney, John Sergeant, and C. S. 
Miller, be requested to prepare the forms of 
documents that may be required for conducting 
the business." 

But, as explained by Mr. Morris — 

"it was not the fashion of our grandfathers 



Re-incorporation of "Pennsylvania" 49 

to enter upon an untrodden field even after 
so much deliberation as this. There seems 
to have been cause for hesitation and delay. 
Perhaps, as has been suggested, there were 
rumors of financial trouble among the 
parent concerns in India; or, more likely still, 
as is indicated by the subsequent action of 
the Board, the right of the Company to 
embark in the new order of business without 
enlarged powers from the Legislature was, 
in spite of exalted legal advice, held in doubt ; 
for, at an adjourned meeting of the Board, 
held on November 3, 1832, the promising 
venture was, for the time, put off by a resolu- 
tion to the effect 'that it is inexpedient for 
the Company to go into the trust business, 
and that the subject be indefinitely post- 
poned. ,,, 

However, the needful plans were consum- 
mated by the later date already mentioned, 
and the new undertaking proceeded under the 
Presidency of Thomas Astley. At this time 
the Company was lodged in a dwelling house 
at No. 72, now 138, South Third Street. From 
1837 to 1857, Hyman Gratz served as President, 
the Company removing in May, 1840, to Wal- 
nut Street above Third — then No. 66, now 304. 



50 Story of Trust Companies 

These premises had been occupied by the 
Philadelphia Saving Fund Society and the 
Pennsylvania Company's lease was originally 
for ten years at an annual rental of twelve 
hundred dollars. 

The second Philadelphia company to engage 
in trust business was also granted its charter 
by the Pennsylvania Legislature of 1836. It, 
like the two institutions in New York, and its 
contemporary in Philadelphia, began opera- 
tions in the insurance field, and like them sub- 
ordinated, at least in the form of its corporate 
title, the new and undeveloped idea of trust 
business. This institution was incorporated 
under an act approved March 17, 1836, as 
The Girard Life Insurance, Annuity and Trust 
Company of Philadelphia. On May 19th of 
the previous year some Philadelphia citizens 
who had been members of the Girard Savings 
Association, held a meeting at which it was 
voted to amend the corporate title to the Girard 
Beneficial Association. Toward the end of 
the year the managers, seemingly with an 
eye upon experiments being tried in other 
directions, decided to enlarge the scope of this 



Incorporation of the Girard 51 

association's business by the addition of a 
department to be devoted to life insurance 
operations. The Legislature was memorialized 
with the result above described. On March 
26th an organization meeting of the managers 
was held at which Benjamin W. Richards was 
chosen President. The Company's first office 
was in rented quarters on the first floor of No. 
159 Chestnut Street (old number), the upper 
portion of the building being occupied as a 
dwelling. The amount of capital subscribed 
was $300,000, payable in instalments spread 
over a two-year period and the charter conveyed 
a privilege within two years of the incorpora- 
tion to increase the stock to $500,000. This 
increase was effected in 1838, but the addi- 
tional funds were apparently not needed and 
the stock was repurchased later, although the 
Company's books continued to show nominal 
capital of $500,000, with $300,000 paid in, 
until 1856, when authority was given for can- 
celing the $200,000 of excess capital, as recorded 
on the general ledger. The Company's cor- 
porate powers were those of the other early 
trust companies and it appears to have been 



52 Story of Trust Companies 

the first concern to do a business of receiving 
money on deposit "subject to cheque or on 
time." The official and clerical force of the 
Company at the time of its inception was made 
up of four members, these being a president, 
treasurer, actuary, and runner. The President, 
Mr. Richards, remained as the Company's head 
until his death in July, 1851, and with his as- 
sociates witnessed many stirring events both 
before and during the panic days of 1837. 
Something of the current scope of banking 
affairs and some of the ill effects of over-develop- 
ment on the part of trust company promoters 
will next be described. 



CHAPTER IV 

BANKING DEVELOPMENTS. OHIO LIFE INSUR- 
ANCE & TRUST COMPANY. PANIC OF 1 837 

In 1837, just before the outbreak of the great 
panic of that year, Levi Woodbury, Secretary 
of the Treasury, made a special report to the 
House of Representatives at Washington on 
the subject of the number, capital, and "de- 
posites" of banks throughout the country. 
Some of his figures were admittedly based 
upon incomplete returns from certain States, 
and there would seem to be some inaccuracies, 
particularly in the light of statistics prepared 
forty years later and published in the annual 
report of Comptroller of the Currency, John 
J. Knox, in 1876. But by combining both sets 
of figures, and including as deposits the amounts 
due to banks, the aggregates for 1835 are found 
to have been : 

53 



54 Story of Trust Companies 





Number of 






STATE 

(in order of size) 


banks (includ- 
ing branches, 
mostly in the 
Southern 
States) 


Capital 


Deposits 

(including 

due to banks) 


New York 


86 


$31,581,460 


$36,640,526 


Massachusetts 


105 


30,410,000 


16,411,799 


Louisiana 


41 


26,422,145 


11,104,295 


Pennsylvania 


43 


17,958,444 


12,767,453 


Maryland 


14 


7,542,639 


5,268,746 


Rhode Island 


61 


8,750,581 


1,888,575 


Ohio 


29 


6,390,741 


2,758,007 


Virginia 


5 


5,840,000 


3,265,964 


Connecticut 


3i 


7,350,766 


1,282,703 


Mississippi 


10 


5,890,162 


2,569,749 


Georgia 


23 


6,783,308 


1,514,501 


Alabama 1 


5 


5,607,623 


2,256,504 


Kentucky 


9 


4,898,685 


2,265,387 


Maine 


36 


3,785,000 


1,651,224 


New Jersey 


24 


3,970,090 


1,139,827 


District of Columbia 


7 


2,613,985 


1,463,299 


South Carolina 


4 


2,288,030 


1,600,956 


Tennessee 


7 


2,890,381 


783,797 


North Carolina 


4 


2,464,925 


867,015 


New Hampshire 


26 


2,655,008 


441,189 


Michigan 


7 


658,980 


702,179 


Delaware 


3 


730,000 


500,848 


Vermont 


17 


921,815 


182,874 


Indiana 


1 


800,000 


131,221 


Missouri 


1 


Branch 


582,125 


Illinois 


2 


278,739 


129,434 


Florida 


2 
603 


114,320 


73,656 




189,597,827 


110,243,853 


Add Bank of United 








States 


1 

604 


35,000,000 


16,322,129 


Total for Country 


$224,597,827 


$126,565,982 



Banking Totals of 1835 55 

These two money totals are exclusive of 
some 123 odd millions of dollars of outstanding 
circulating notes and miscellaneous liabilities. 
The aggregate liabilities of the country's banks 
appear, therefore, to have been a matter of 
something less than 475 millions of dollars, on 
or about January 1, 1835. 

The significance, or rather insignificance, of 
these early aggregates of capital, deposits and 
circulation as contrasted with those of to-day 
will be made apparent in later chapters, but, 
in passing, the reader should have in mind one 
marked aspect of the foregoing totals. Our 
ancestors of eighty odd years ago conducted 
their banks with contributions to capital equal 
to nearly double the volume of deposits; while 
to-day twenty-seven thousand odd banks, 
private bankers, and trust companies, combined, 
throughout the country, with about twenty- 
six billions of dollars of total resources and 
liabilities, have approximately seventeen per 
cent, of capital and undivided profits against 
eighty- three per cent, of other liabilities. Also, 
we may take just a moment to grasp an amazing 
fact, before which even modern minds, accus- 



56 Story of Trust Companies 

tomed to big things, must marvel. The un- 
dreamed of result accomplished since the days 
of 1835, when America's banking wealth aggre- 
gated less than five hundred millions of dollars, 
is that the total has gone through a doubling 
and redoubling process nearly six times over; 
that the ratio of 191 6 to 1835 is as 50 to 1 ; that 
to-day a single New York bank, the National 
City, shows 615 millions of dollars of total 
resources, and a single New York trust com- 
pany, the Guaranty, is not far behind with 
520 millions. 

Next and before returning to the subject of 
trust company developments, a little picture 
is to be drawn of the New York State banks 
of the period. The eighty-six banks mentioned 
in the preceding tabulation had numbered 
four years earlier, in 1831, only forty-nine. 
Of these, thirty-four were up-state institutions 
and fifteen were in what is now New York City, 
including the Bank of Long Island. The 
State Banking Commissioners in their first 
report, as of January 1, 1831, showed the capital 
of these fifteen metropolitan banks to be 
$14,301,200. This sum did not include, how- 



Condition of New York City Banks 57 

ever, any part of the capital of the Bank of the 
United States, with its three branches in New 
York City. The commissioners showed in this 
report the amount of each bank's stock owned 
by non-residents of the State, the quantity of 
bank notes in circulation, of specie on hand, 
of directors' liability, and of stock owned by 
the directors. But the report was silent on the 
question of other assets and liabilities; in fact, 
the explanation was made that "a statement 
of assets and deposits is not shown because 
publicity might be the cause of affecting the 
comparative reputation of some injuriously." 
Practically all of the banks were paying divi- 
dends at this time ranging from 2 to 8 per 
cent, per annum, and the Mechanics Bank, 
after twenty years of operations, was disburs- 
ing as much as $140,000 a year, being 7 per 
cent, on its $2,000,000 of capital. Five years 
later, in 1836, this institution's balance sheet 
was the largest in New York, showing footings 
of $9,035,500. On the other hand, the City 
Bank showed total resources of only $2,571,844. 
Its capital was $720,000; its undivided profits 
$160,805; its circulation $345,659; its "depo- 



58 Story of Trust Companies 

sites" $498,799; during 1835, it had paid 
$50,400 in dividends, 7 per cent, on its capital. 

New York's two trust companies, the old 
Farmers Fire and the N. Y. Life Insurance 
& Trust, had a western rival fully two years 
before the two Philadelphia companies, as 
already described, acquired trust powers. This 
was a Cincinnati concern, of ample proportions 
but destined less than a quarter of a century 
afterward to come to an unfortunate ending. 
Its title was The Ohio Life Insurance & Trust 
Company, and it was granted a perpetual 
charter on February 12, 1834, with authority 
to issue $2,000,000 of capital. It had permis- 
sion to issue notes, until 1843, "for not more 
than twice the amounts of deposits allowed to 
remain for not less than a year, and for not 
more than half the paid-up capital invested in 
loans on real estate"; the charter was to be 
forfeited if it should suspend for more than 
thirty days. Its first President was Micajah 
T. Williams. 

Four years after the Company was organized, 
a voluminous report was issued showing that 
there were nine trustees in Cincinnati, two in 



An Ohio Company 59 

Columbus, one in Dayton, two in New York, 
one in Boston, one in Philadelphia, and one in 
New Orleans. The Company's banking de- 
partment loans amounted to $1,123,780.21. It 
had notes in circulation in the sum of $433,765, 
and owned $5,000,000 of stock of the State of 
Ohio, redeemable in 1856 and i860 and bearing 
6 per cent, interest. 

That the Company inclined more to banking 
than insurance business was revealed by the 
statement that the Company had received 
nothing upon the sale of annuities. Its life 
insurance premiums, covering only twenty 
lives, had amounted during the four years to 
only $4921.75. But that trust company func- 
tions were either not yet understood or else 
not particularly exploited, would seem to be 
indicated by a brief admission contained in the 
report that "nothing had been received in trust 
to be invested at the risk of the depositor," 
and that "the Company is not liable for any 
amount as receiver." 

The Company had a branch orifice in New 
York by 1839. This was opened at No. 62 
Wall Street and the location changed frequently 



60 Story of Trust Companies 

during the next eighteen years which preceded 
the Company's suspension. 

In 1835, the Southern Life Insurance~& Trust 
Company was chartered. It claimed' privileges 
of the most extensive and diversified character. 
Shortly afterward it was described in Sumner's 
History of Banking, as follows: 

"Its capital is $2,000,000.00, with the 
privilege of increasing it to $4,000,000.00. 
It is directed to report to the Court of 
Appeals annually, which report is made to 
Council. No such report has ever been 
made, or any other. The capital stock of 
said bank is to be taxed at the same rate as 
all other personal property of the Territory, 
but the tax is not to exceed $5,000.00. The 
Territorial guaranty is to be given on the 
bonds of the corporation under certain con- 
ditions. This bank claims to be located at 
St. Augustine, but, it is said, is chiefly con- 
ducted in New York, and has an agency at 
Appalachicola. ,, 

In spite of the mysteries surrounding this 
institution it seems to have continued in busi- 
ness until at least 1839, and in fact did have 




CO 

00 



A Connecticut Institution 61 

an agency in New York, at No. 12 Wall Street. 
Shortly afterward it disappeared from the 
city directory and is to be remembered no 
further in our story. 

Connecticut had its own little trust insti- 
tution as early as 1837. It was known as 
the Fairfield Loan & Trust Company, and 
although its operations were of short duration, 
the reader may be interested to see a copy of 
one of the Company's fifty-cent currency notes, 
as reproduced herewith. This interest-bearing 
obligation was a forerunner of the "shinplas- 
ters" soon to make their appearance and 
serve for a single generation in substitution 
for minor coin as a part of our circulating 
media. 

For several years preceding 1837 financial 
affairs throughout the nation had been greatly 
disarranged. In 1832 President Jackson vetoed 
the rechartering of the Second United States 
Bank. In 1836 the Legislature of Pennsyl- 
vania granted a charter to the United States 
Bank of Pennsylvania for thirty years. Nicho- 
las Biddle, the President, viewed the new 
charter as more favorable than the one ori- 



62 Story of Trust Companies 

ginally obtained from Congress, but Horace 
White relates in his book, Money and Banking: 



"An enormous bonus was paid, or pro- 
mised, to the State, two millions in cash, and 
one hundred thousand dollars per year for 
twenty years, besides various subscriptions 
to the stock of railroads, canals, and turn- 
pikes in the State. Benton said that every 
circumstance of its enactment betokened 
bribery of the members who passed it, and 
an attempt to bribe the people by distribut- 
ing the bonus among them. There is too 
much reason to agree with him. The Gov- 
ernment was still a shareholder in the 
Bank to the par value of $7,000,000 and 
there was some trouble in getting this money 
out, but it was paid in four annual install- 
ments. 

"When the Bank found itself, with its 
enormous capital, restricted to Philadelphia 
and the neighboring country, it gradually 
turned itself into a financial company. 
Hitherto it had confined itself to the banking 
business as strictly as banks usually do, 
discounting commercial paper, buying bills 
of exchange, and dealing in coin and bullion. 
Now it advanced money largely on stocks. 



The Panic of 1837 6 3 

Before March, 1836, it had twenty millions 
thus invested. The country was now in 
the fever of speculation which culminated in 
the panic of 1837." 

In May of that year suspensions occurred 
everywhere. In New York there were riots, 
and placards appeared reading : 

NO RAG MONEY 
GIVE GOLD AND SILVER 

DOWN WITH THE 
CHARTERED MONOPOLIES 

During the year eight banks failed in Massa- 
chusetts, nearly all in Boston, or the immediate 
neighborhood. They represented capital of 
about four million dollars. The panic con- 
tinued with great severity until the resumption 
of specie payments, which occurred in New York 
during May, 1838. The banks in Pennsylvania 
and the Southern States resumed in August, but 
again suspended a month later, and this con- 
dition prevailed during many months thereafter, 
only the New York banks continuing to deal 
on a basis of specie payments during the year 
1840. Finally in 1841, following suspensions 



64 Story of Trust Companies 

by the Bank of the United States in 1837 and 
1838, there was a third and complete collapse 
of that institution, but shortly afterwards 
financial conditions again righted themselves 
and by degrees general business proceeded on 
more normal lines. 

The panic of 1837 ^ as usually been regarded 
as the most severe depression ever experienced 
by the country, unless perhaps the greater 
scope of the railroad failures of 1893 and the 
banking troubles of 1907 may be said to have 
covered wider areas of commercial and financial 
distress. Nevertheless, it appears that such 
few trust companies as were then doing busi- 
ness in New York, Philadelphia, Cincinnati, 
and the South, were not in a single instance 
driven out of business during the acuteness 
of the troubles of that period. 

Toward the close of the year 1837, and after 
some little recovery had been made from the 
depression of the summer of that year, an in- 
teresting event occurred in New York City. 
On November 27th there was convened, in the 
City Hall, the first banking convention of im- 
portance to be held in the country. This 



An Early Bankers' Convention 65 

was composed of 142 delegates representing 
nineteen different States. One of these came 
from as far south as Georgia, three were from 
Kentucky, and what was then the extreme west 
was represented by one delegate from Indiana. 
The purpose of this gathering was to take 
measures looking toward an early resumption 
of specie payments. William Meredith, Presi- 
dent of the Schuylkill Bank of Philadelphia, 
acted as chairman. Albert Gallatin, George 
Newbold, and Cornelius Heyer were appointed 
a committee to publish the views of the con- 
vention. The last named was President of the 
Bank of New York, and one of the other an- 
cients in attendance at the time was a well- 
known banker of the period, President of the 
Tradesmen's Bank and one of the incorpora- 
tors of the New York Life Insurance & Trust 
Company, by name Preserved Fish! 



CHAPTER V 

1838. FREE BANKING ACT. IRRESPONSIBLE 

COMPANIES IN NEW YORK AND THE 

INTERIOR 

Financial corporations in New York State, 
prior to 1838, consisted of branches of the Bank 
of the United States, the older commercial and 
savings institutions enjoying special charters, 
and safety fund banks, created under the laws 
of that year, together with the trust companies, 
as heretofore described. The plan of the safety 
fund banks was a required deposit with the 
State equal to one-half of one per cent, of their 
capital stock during each of six years. This 
3 per cent, of the capital of the banks consti- 
tuted a fund for the redemption of circulating 
notes and other indebtedness of any of the 
banks becoming insolvent. In April, 1838, 
the so-called free banking system was estab- 
lished. Its methods and results were de- 

66 



Operations of Free Banking Act 67 

scribed eleven years later by Millard Fillmore, 
then State Comptroller, in the following 
terms : 

"There was nothing in the act that re- 
quired individual bankers to deposit any 
particular amount of securities before they 
commenced banking. The country was then 
flooded with stocks from almost every State 
and the consequence was that numerous 
banks sprang into existence under this law. 
Repudiation soon followed, many States 
that did not repudiate failed to meet their 
obligations, confidence was impaired, credit 
was shaken, and stocks generally depreciated 
in the markets, the consequence was that 
many banks failed and the Legislature par- 
tially retrieved its error, in 1840, by exclud- 
ing all stocks except those issued by this 
State, and required those to be, or to be 
made, equal to a five per cent, stock. 

"Finding the small banks unsafe, the 
Legislature in 1844 required individual bank- 
ers to deposit securities to the amount of at 
least $50,000 ; and associations to the amount 
of $100,000 before they were entitled to any 
notes for circulation. The stringency of the 
money market in 1847, admonished the 



68 Story of Trust Companies 

Legislature that the security of these banks 
was not sufficient; and in 1848 they required 
the stocks deposited to be stocks of this 
State, and equal to six per cent, stock; and 
the bonds and mortgages to bear an interest 
of seven per cent, per annum, and that they 
should not be for an amount exceeding two- 
fifths of the value of the land covered by the 
mortgage. This is the free bank system, as 
it now stands, and it takes its name from the 
fact that all are freely permitted to embark 
in it who comply with the rules prescribed. 
It is no monopoly — no exclusive right granted 
by the Legislature to a favored few, but it 
is open to all who can give the requisite 
security.' ' 

In an earlier State Comptroller's report, 
transmitted to the Legislature in the first week 
of January, 1839, a list was presented of fifty- 
three banks which had filed certificates at 
Albany during the eight and one-half months 
following the passage of the Free Banking Act. 
Among some strange old figures contained in 
this report were the totals of property values 
as they existed at the time in New York County 
and State. These were : 




o 

B 

U 

o 

a 

o 

< 



Group of New York Incorporations 69 

New York County personal property $ 67,297,241 

" " " real property 196,450,000 

" " State personal property 122,021,033 

M " " real property 498,430,054 



These are in contrast with the figures for 
1915* which show the four aggregates of valua- 
tion at 637 millions of dollars, 4778 millions of 
dollars, 924 millions of dollars, and 11,146 
millions of dollars, respectively. 

Included among the banks then reported 
upon were four institutions which, in line with 
recent practice, had chosen to include the word 
"trust" in their title. These were the Erie 
Canal Trust & Banking Company of Buffalo, 
with subscribed capital of $200,000; the Lock- 
port Bank & Trust Company, capital $500,000; 
the United States Trust & Banking Company, 
New York City, capital $1,000,000; and the 
North American Trust & Banking Company, 
also of New York, capital $2,000,000. The 
duration of the charters of these concerns ranged 
from 262 to 500 years, and the report showed, 
under the head of "To what amount capital 
may be increased," that while the Lockport 
institution had ambitions later to expand its 



70 Story of Trust Companies 

capital to §2,000,000, and the Buffalo Company 
contemplated an increase to $10,000,000, the 
two metropolitan concerns proposed at some 
time in the future, near or remote, to issue 
shares of stock up to $50,000,000, in each case. 
These were of the number of what were known 
as "free money banks." Three of the four 
concerns above named ceased to do business 
within a year or so after their incorporation, 
as did the City Trust & Banking Company of 
New York, organized in 1839. A concern 
known as the Howard Trust & Banking Com- 
pany of Troy continued from 1839 to 1844, 
and only the little Lockport concern lasted 
until 1848, when it too disappeared from the 
circle of free, too free, banking. 

During 1839, and several succeeding years, 
Wall Street experienced a sudden invasion of 
companies organized in other States, mostly 
in the South. The title "trust company" 
was apparently regarded as a fetching bit of 
enterprise. Among companies having branch 
offices in Wall Street during 1839 and the very 
early forties may be mentioned the Charleston 
(S. C.) Insurance & Trust Company, the Ameri- 



A Mobile Company 71 

can Life Insurance & Trust Company (Balti- 
more), the Alabama Life Insurance & Trust 
Company, and the Georgia Insurance & Trust 
Company. These concerns, with the Southern 
Life Insurance & Trust, already mentioned, 
all disappeared by 1843, leaving the New York 
City field open once more to the Farmers' 
and the New York Life Insurance & Trust. 

The Alabama Company did, however, occupy 
a place in Mobile's financial affairs during 
twenty odd years following its grant of trust 
powers in 1836, and one of its stock certificates, 
part of an original million of dollars' worth 
issued, unofficially transferred many years after- 
ward to the ownership of the author, is repro- 
duced herewith in commemoration of the rise 
and fall of one sturdy institution the glory of 
which departed over half a century ago. 

Throughout the troubles of 1837, and as they 
extended into the early forties, the press con- 
tinued to give out warnings against inflation. 
Sometimes these took the form of editorial 
comment, but occasionally the constant out- 
cropping of new banks became the subject 
of humorous protestations. An amusing illus- 



72 Story of Trust Companies 

tration is to be found in a poem which appeared 
in the New York New Era, published at the 
close of 1840. This was entitled "The Wall 
Street Chorus." Probably its author was 
addressing his satires not only against the 
banks but in the direction of some of the irre- 
sponsible trust companies then opening up 
branches in New York; at any rate his verses 
were clever enough to be here repeated: 

THE WALL STREET CHORUS 

Give me a Bank — a paper Bank, 
The best machine for saving labor, 

For who would toil and sweat himself, 

When there's a chance to sweat his neighbor? 

Away now, with your power looms, 
Revolving Jacks and spinning Jennies; 

Contrivances for picking wool 

Can't match the Banks for picking pennies. 

"Ex nihil nihil fit," was once 
A maxim much in vogue with some; 

But few indeed can now maintain 

That "nothing can from nothing come." 

For though the ancients could convert 
Their gold to rags (as we are told), 













axvoi iixaap • • •• • '•_ Aofi 



r©<ans> 



*,;■ 



'JS? kVtWCt 



H&*'dR 



Control at Albany 73 

Yet we, in times more civilized, 

Can make from rags the best of gold. 

All hail, then, glorious alchemy, 

That can from nothing something make ! 

What pity things created thus, 

Their primal form are prone to take. 

So let us have a Bank, my boys! 

A fortune thus we all may win; 
Like lilies of the valley live, 

Who "toil not, neither do they spin!" 

With money then, all debts we'll pay, 
And should our credit once get low, 

It never comes amiss to say, 

"The Government has made it so!" 

At Albany the State Comptroller was charged 
with the duty of supervising the affairs of the 
institutions formed under the Free Banking 
Act in respect of holdings of securities deposited 
against issues of circulating notes, also as 
custodian of their blank notes. Reporting at 
the end of 1840 upon transactions down to 
December 1, 1839, the Comptroller showed a 
most elaborate table of notes ordered from and 
delivered by him down to that date. This 
contained columns with an analysis of so many 



74 Story of Trust Companies 

i's, 2's, 3's, 5's, io's, 2o's, 5o's, ioo's, 5oo's, and 
iooo's. As to specific trust company affairs, 
his report showed that the North American 
Trust & Banking Company of New York had 
$37 l >9°° of stocks and mortgages on deposit 
to secure circulation. He also remarked that 
the securities of the New York Trust & Banking 
Company had been sold for sufficient to redeem 
all of its circulating notes at par. 

At this time the Bank of Commerce towered 
above all the other seventy-five banks in New 
York in point of capital, which was $5,000,000, 
but the North American Trust & Banking 
Company came second with $2,000,000 of 
capital, and there were only five other banking 
institutions in New York City with as much as 
$1,000,000 of capital each. 

In 1846 the Ohio Life Insurance & Trust 
Company was permitted, by an act of the 
Legislature, to become either an independent 
bank or a branch of the Bank of the State of 
Ohio, if it so desired, by setting off banking 
capital in specie of not less than $300,000 nor 
more than $500,000. It appears, however, not 
to have availed itself of this privilege, for the 



Bank Supervision 75 

records of later years do not show that it had 
become one of some thirty-seven branches of 
The Bank of the State. Moreover, by this 
time the other commercial banks in Ohio were 
only seven in number. 

During these years, and until 1852, New York 
State seemed to get down to a more normal and 
restricted view of activities in the new field of 
trust business. Within the four years from 
1849 to 1852, inclusive, the city directories of 
New York mentioned no trust company except 
the Farmers', the New York Life, and the 
branch of the Ohio Company. 

On April 12, 1851, the office of Superintendent 
of Banks was established by law at Albany, but 
there was no thought at the time of placing 
the trust companies under his control; in fact 
supervision by his department through examina- 
tions was not begun until nearly a quarter of a 
century later. 

About this time an up-state institution was 
granted a special charter. This was the 
Buffalo Trust Company (in no way connected 
with the present corporation of that name), 
incorporated in the spring of 1852. It contin- 



76 Story of Trust Companies 

ued in business until 1857, and seems to have 
been a sizable institution, but not firmly 
enough grounded to withstand the shock of the 
panic of that year. 

At this period, 1852, Philadelphia had listed 
in the city directory sixteen "banking institu- 
tions," two "savings funds societies," and 
eleven concerns denominated "insurance com- 
panies, lives, and annuities." Of these last, 
three were trust companies, the Pennsylvania, 
the Girard, and a company known as the Na- 
tional Safety & Trust Company. The one 
last named had been chartered in 1841. It 
was a short-lived company. 

After the North American Trust & Banking 
Company of New York failed, the receiver 
David Leavitt, was confronted with many 
problems arising out of the vagaries of manage- 
ment indulged in by those who had carried on 
the Company's brief business. 

In 1853 litigation was instituted in the New 
York Supreme Court to the end of testing this 
defunct concern's liability under certain obliga- 
tions which the receiver sought to evade. 
There had been, back in 1840, an issue of so- 



Litigation in 1853 77 

called "Million and First Half Million of Trust 
Mortgages." These had been given for the 
purpose of providing the Company with needful 
funds, and the question now arose as to whether 
they were valid debts or whether they had been 
issued for the purpose of defrauding the public. 
Two or more large mortgages had been given 
by the North American Company and a lot of 
1500 bonds issued as well, each of the denomina- 
tion of £250. The general plan of issuing the 
bonds was not unlike the already prevailing 
mode of securing bond issues by deeds of trust, 
and when the case was argued before the Court 
the point was made that to have executed 1500 
distinct mortgages would have entailed a great 
deal of work ; accordingly the larger instruments 
had been made to run in favor of trustees who, 
using their own judgment, might offer invest- 
ments on a participation basis. 

In support of the allegation that the mort- 
gages had been made with the direct intent 
to defraud, long arguments were presented, 
challenging the authority of a trust company 
to issue bills or notes maturing at a future date ; 
the statutes of May, 1840, having "prohibited 



78 Story of Trust Companies 

ever} 7 banking association from issuing or 
circulating any bill or note of said association, 
unless made payable on demand and without 
interest." The penalty prescribed for a viola- 
tion of this law was that any official or member 
should be subject to fine and imprisonment. 
A technical claim was set up that the bonds 
had been merely stamped, and not impressed 
by wax or wafer, and so were not sealed instru- 
ments according to law, but post bills or notes, 
therefore unlawful, and consequently that the 
assignments collateral to them were null and 
void. Part of the controversy hinged upon 
the question as to whether these bonds, each 
made to yield the equivalent of £250 payable 
in seven years in pounds sterling, at a London 
counting house, with interest coupons attached, 
were "likely to be imposed upon, or received by, 
or circulated among, the people of New York 
as money or currency, and whether the Legisla- 
ture intended to guard the circulating medium 
of the British nation from an unsafe infusion 
of American credits. 

It was shown, on the other hand, that in 1838 
the Merchants' Exchange Company had raised 




O 



d 

"3 

,>» 

d 

'5 

o 



o 
d 

.§ 

u 



Remarkable Bank Growth 79 

$400,000 to complete their building, by the 
creation of a large number of bonds in the name 
of one person, to whom a mortgage had in turn 
been given. The legal battle over these ques- 
tions was bitter and prolix. Apparently the 
Court had not before had to deal with problems 
involving rights under corporate mortgages 
securing bonds, but the decision finally reached 
was that no fraud had been intended and that 
the bonds were valid instruments. 

Throughout the country the growth of the 
state banks during the four years from 1850 
to 1854 was remarkable. Twenty years later 
Federal Comptroller Knox prepared statistics 
showing that within those five years there had 
been gains of approximately fifty per cent, both 
in the number of these institutions and in their 
capitalization, circulation, and deposits. 

The actual figures were: 



Number of State banks 
Capital stock 
Circulating notes 
Deposits, including due to 
banks 



1850 



824 

$217,317,211 

131,366,526 

146,304,046 



1854 



1208 

$301,376,071 

204,689,207 

238,510,906 



J 



80 Story of Trust Companies 

Of the 384 new banks established during this 
short period New York State contributed 123. 

The Bankers Magazine of November, 1854^ 
devoted considerable space to the subject of 
trust company affairs. It showed that on 
July 31st of that year the New York Life 
Insurance & Trust Company had a little over 
$6,200,000 of total resources and liabilities, 
including $1,000,000 of capital and $422,000 
of surplus. The United States Trust Company 
on the same date, and after one year of opera- 
tions, showed $1,000,000 of capital, $480,000 
of deposits, and $46,000 of surplus. 

Not unnaturally the writer of the article 
seemed to find it wellnigh impossible to sepa- 
rate the two theories of life insurance and trust 
company business. He declared : 

"The Mutual Life is in effect and sub- 
stantially so a trust company and a very 
important trust too. It embodies the savings 
of at least 7834 persons, to whom (or for 
whom) policies have been issued and are 
now in force, of which 6720 are for life, 946 
for the term of seven years, and 168 for shorter 
periods. * ' 



Editorial Comment in 1854 81 

He remarked also that it had long been a 
custom for executors, administrators, and trus- 
tees to invest trust funds in bank stocks, and 
that this in the course of time had come to be 
regarded as an unsound practice, the State of 
Pennsylvania having in 1853 decreed that such 
investments were invalid and made at the 
personal risk of such trustees. He concluded 
his observations by saying: 

" At present in New York State the trustee 
can only protect himself from risk when he 
invests the trust funds in real estate or 
government securities, or invests by order 
of the Court." 

This was a period in which little substantial 
progress was made in the way of sound trust 
company development. Their plans and ulti- 
mate purposes were not very clearly defined and 
fell far short of being understood by the public. 
It would seem that both the panic of 1837 and 
the subsequent outcropping of irresponsible 
state banks, some of. them calling themselves 
trust companies, must have discouraged the 
more conservative class of business people from 



82 Story of Trust Companies 

launching new enterprises in the trust company 
field, at least on a scale, or in any instance 
having a personnel, to be compared with the 
companies founded down to 1836. From this 
year onward, during the seventeen years which 
elapsed until 1853, no American trust company, 
of those we know to-day, took out a charter. 

In 1853, the same year in which the New York 
Clearing House was formed, a new company 
appeared in New York City, the first to bear 
a title without an indication of any insurance 
functions whatever. This was the United 
States Trust Company, which began business 
at No. 40 Wall Street during the early summer 
of that year. Some of its first efforts and 
accomplishments will be narrated in the chapter 
which follows. 



CHAPTER VI 

I853. UNITED STATES TRUST COMPANY OF 
NEW YORK 

The United States Trust Company of New 
York was chartered on April 12, 1853. Among 
its incorporators were Peter Cooper, John J. 
Phelps, Erastus Corning, Shepherd Knapp, and 
Wilson G. Hunt. The charter was the basis of 
all special charters of a similar character sub- 
sequently granted in New York, as well as of 
the general law for the incorporation of trust 
companies which, upon its adoption thirty-four 
years later, terminated the plan of granting 
special charters to New York trust companies. 

The first office was located at No. 40 Wall 
Street where Joseph Lawrence, the first Presi- 
dent, was elected at a meeting of the trustees 
held June 14, 1853. Mr. Lawrence held office 
until May, 1865, when on account of failing 
health he became obliged to surrender his 
important duties and was succeeded by John 

83 



84 Story of Trust Companies 

A. Stewart, whose services as President con- 
tinued for nearly forty years thereafter. 

Early in the Company's existence a contro- 
versy arose involving the question of whether 
the corporation, in its capacity as receiver for 
the Knickerbocker Savings Institution, was 
not indirectly conducting a banking business. 
In 1854 the Knickerbocker had made a small 
loan on some bank stock which was questioned 
as being a possible violation of its charter or of 
the 1853 savings bank law. The New York 
State Court of Appeals decreed that the insti- 
tution had been within its right, the law being 
only a prohibition against the loaning of saving 
institution funds on mere personal securities, 
but the trust company found itself in the posi- 
tion of being challenged as to its right to con- 
duct a banking business in so far as this might 
be required in the course of administering the 
receivership. Finally after due deliberation, 
the same Court ruled in favor of the trust com- 
pany by declaring: 

"The duties of this Company are prescribed 
by the second section of its charter which do 
not include banking powers." 



Reporting to Supreme Court 85 

Adding, as the Court's opinion: 

"The charter of the United States Trust 
Company is not unconstitutional. It is not 
a corporation created for banking purposes 
within the meaning of Section 4 of Article 
8 of the constitution." 

The charter of the Company contained a 
provision (Section 20) that: 

"The Board of Trustees shall exhibit 
annually to the Supreme Court, on such day 
as said Court shall appoint, a full statement 
of their affairs, in such form, and verified in 
such manner as the Court shall direct. The 
Court, should it be deemed proper, may refer 
such statement to a referee, with direction 
to make a full and thorough investigation into 
the affairs and management of the Company, 
and to report his opinion in relation to the 
ability and integrity with which its affairs 
are conducted, the prudence and safety of 
its investments, the security afforded to those 
by whom its engagements are held, and the 
advantage derived by the public from its 
operations. The expenses of every investiga- 
tion so made shall be defrayed by the Com- 
pany in such sums as the said Court shall 
certify to be reasonable and just." 



86 Story of Trust Companies 

Agreeably to the foregoing, annual reports 
were made for a number of years by referees 
of the Supreme Court. Their findings were 
the result of elaborate examinations and some 
of the facts and circumstances set forth in the 
report of 1855 are sufficiently of interest to be 
here related. It was a document of seventy- 
three pages and showed among other things 
that there had been 260 original subscribers 
to the stock two years earlier, of which number 
113 continued to hold their shares, but that 147 
had sold their stock and that the Company had 
never made any loan upon security consisting 
of its own shares. It was also reported that 
as many as 1343 shares had been transferred 
during the year 1854. 

The officers of the Company were three in 
number: 

Salary 
Joseph Lawrence, President $5000 per annum 

John A. Stewart, Secretary 3000 " " 

G. P. Hinman, Bookkeeper 1200 " " 

The Referee described how both the Presi- 
dent and the Secretary were each required to 
keep a record book showing in duplicate the 



Precautions in Early Management 87 

details of each day's business transactions. 
He said: 

"The precautions taken by the Company 
bring every transfer of stock under the im- 
mediate inspection of its President, and the 
book which he himself keeps, and in which 
he enters every certificate that is surren- 
dered, and every one that is issued, is an 
additional check upon his subordinates, and 
imposes upon him primarily the responsibility 
for any error. This practice is a wise one, 
and the labor being voluntarily assumed by 
the President, shows how prudently and 
cautiously his position is filled." 

But he offered a criticism of the manner in 
which the record books were kept, pointing 
out that as they related to cash on hand at 
the end of each day they were not quite in 
agreement. This criticism went on to relate: 

"The disagreement is in the detail trans- 
actions, wherein money actually passes. 
Thus, in one case where a party was entitled 
to draw out a deposit of the sum of $1600 
he actually drew out in cash only $900 and 
took a certificate of trust for $700. The 



88 Story of Trust Companies 

payments-receivable book showed the whole 
transactions, while the Secretary's record 
book showed only the payment of the $900. 
Thus Section 4 says, the President shall 
keep a 'daily record of all monies received, 1 
etc., not of monies paid also. Yet the very 
next sentence says, 'his record of payments 
and receipts shall be compared daily with 
the record kept by the Secretary.' Why 
compare it with the record kept by the Secre- 
tary, unless both are to keep a record of 
payments as well as receipts? And why call 
it 'his record of payments,' unless he is 
required to keep something more than a 
record of receipts?" 

However, in a "Conclusion" appended to 
the report an unqualified bill of good health was 
offered, in the following words: 

" My opinion as to the prudence and safety 
of the investments of the Company, the 
security offered to its dealers, and the ad- 
vantages flowing to the public from its opera- 
tions is already -manifest from the foregoing 
pages, and I have but to add in conclusion 
that the prudence, care, ability, and integrity 
with which its affairs have been conducted are 
eminently deserving the public confidence." 



An Auction Sale of Assets 89 

As late as 1856 it seems to have been the 
practice to hold public sales of the miscellane- 
ous assets of failed financial institutions. An 
illustration of this is an old catalogue, issued 
from the presses of William C. Bryant & Com- 
pany at No. 41 Nassau Street, announcing the 
offering of certain property covered by 

A List of 

Overdrafts, Judgments, Notes 

and 

Balances Due on Notes 

to be sold by 

P. R. Wilkins, Auctioneer, 

for 

The United States Trust Company of New York 

Receiver of the Knickerbocker Bank 

In the City of New York 

On Monday, October 27, 1856, 

at Twelve O'clock, 

At the Merchants' Exchange, in the City of 

New York. 



90 Story of Trust Companies 

In this pamphlet long schedules of overdrafts, 
judgments and notes were set up, and as to the 
property first mentioned, the trust company- 
was particular to specify: 

"The amounts of overdrafts are as shown 
on the ledgers of the bank and are supposed 
to be correct, but are sold without recourse 
to the Receiver." 

According to a resolution passed in the State 
Senate on January 7, 1857, the several trust 
companies were required to report to certain 
members of the Legislature "on their present 
condition and to submit a summary of their 
transactions during the year 1856." The re- 
port of the committee stated that the special 
charters granted to these institutions conveyed 
great powers, and that 

"it has always been the policy of the State to 
keep a watchful eye upon them and guard 
the community from those evils and losses 
which could result from improper or unwise 
use of the power conveyed. The reports 
herein made show that the confidence of the 
State of New York has not been misplaced, 
but that those institutions are prosecuting 



An 1857 Statement 91 

a prudent and successful business, beneficial 
to the community at large, and profitable to 
the stockholders concerned.' ' 

Included among the figures presented was 
a "summary" of trust company deposits, on 
January 1, 1857, as subjoined: 

United States Trust Company of New York $1,614,450.73 
New York Life Insurance & Trust Company 3,833,317.61 
Buffalo Trust Company 185,738.23 

Total $5,633,506.57 

These three companies had 1837 depositors, 
the average balance of each depositor being 
$3066.68. 

This Legislative Committee appears to have 
given considerable attention to the affairs of 
the three companies shown above, but for some 
reason entirely overlooked the duty of reporting 
upon the Farmers' Loan & Trust Company, 
or upon any of its activities, although it was a 
fully qualified institution which had been 
engaged in the same line of business no less 
than thirty-five years previous to the making 
of the report. 

As illustrating a later and most interesting 



92 Story of Trust Companies 

appointment of a trust company to act as 
trustee on behalf of a great benevolent society, 
something may here be interpolated regarding 
the American Bible Society and the United 
States Trust Company. For many years pre- 
vious to 1 9 10 the Society had managed for 
itself some millions of dollars' worth of property 
acquired under the wills of individuals, which 
provided that the income should be devoted to 
the purposes of the Society. In that year, by 
resolution of the Board of Managers of the So- 
ciety, the securities representing these trusts were 
turned over to the United States Trust Com- 
pany, and that Company was also appointed 
Assistant Treasurer of the Society. When the 
change was made it was in recognition of the 
fact that although the Society, by virtue of its 
charter, was perpetual, the safeguarding and 
administering of its possessions might well be 
left to the discretion of a financial body skilled 
in the intricacies of modern investment. The 
trust thus established was of rather a different 
character from those created in the ordinary 
routine of corporate and individual business 
transactions. It might be properly said that 



American Bible Society Trusteeship 93 

it was a trust affecting far more than the 
material side of human life. 

The American Bible Society is in this year, 
191 6, celebrating the one hundredth anniver- 
sary of its founding. A century of good works 
is behind this organization, which has for its 
object "the encouragement of a wider circula- 
tion of the Holy Scriptures without note or 
comment." Since those early beginnings the 
activities of the Society have been felt at the 
uttermost ends of the earth, as well as at home, 
and the Scriptures issued since then, either at 
the Bible House in New York City, or under 
the Society's supervision in foreign lands, have 
totaled over one hundred million copies. 

Either alone, or in collaboration with others, 
this organization has translated the Bible, in 
whole or in part, into not less than one hundred 
and seventy-five languages. European socie- 
ties have translated it into some three hundred 
more, and it has been stated that "versions are 
now available in which seven out of every ten 
human beings may read or hear at least the 
full Gospel narrative in the words of Holy 
Scripture." 



94 Story of Trust Companies 

Thus is to be had a glimpse of how, in the 
evolution of trust company affairs, the business 
side of one of our largest benevolent under- 
takings has come to have its part in a sphere 
where almost every dealing is on the side of 
commerce, finance, or other interests in which 
the prevailing test must needs be material 
gain, not spiritual advancement. 



CHAPTER VII 

1857. FAILURE OF THE OHIO LIFE. FOUNDING 

OF MERCHANTS' LOAN & TRUST, 

CHICAGO 

Both financial and political historians seem 
well agreed that the suspension of the Ohio 
Life Insurance & Trust Company on August 
24, 1857, was the first bolt to fall in the storm 
of disaster that overtook the country during 
that memorable panic year. 

The Company had not been altogether pros- 
perous for some years. In 1854 the Cincinnati 
Commercial had taken the view that the institu- 
tion was being " taxed out of existence." It 
described the law of two years earlier which 
had imposed about $100,000 burden of taxes 
on $3,000,000 of bond and mortgage loans. 
Speaking of the hardship that it worked upon 
the Company, this newspaper said: 

95 



96 Story of Trust Companies 

"We are most decidedly in favor of free 
trade in money, but we have at least that 
amount of anxiety for the public welfare 
which would induce us to prefer to spare the 
lives of a few wicked bankers, rather than 
to involve the community in pecuniary dis- 
tress, and press thousands into the Golgotha 
of bankruptcy." 

On August 25, 1857 the New York Tribune 
published a news article in the following words : 

"The Stock market was very active to-day, 
the aggregate sales in and out of the Board 
exceeding 25,000 shares. Some parties at 
the First Board had knowledge of the impend- 
ing suspension of the Ohio Trust Company 
and sold freely on the anticipated effect. 
After the suspension was made public the 
market, as will be seen by the transactions 
of the Second Board, exhibited a quasi panic, 
most marked in Cleveland and Pittsburgh 
which sold down to 20, having been 29^ on 
Saturday. At the close a sale was made at 
22. The decline in Pittsburgh was occasioned 
by the apprehension that the Trust Co. 
held a large amount of the stock as collateral, 
which would be thrown upon the market. 
. . . The announcement between the boards 



Outbreak of Panic in 1857 97 

that the Ohio Life Insurance & Trust Com- 
pany had been obliged to suspend payment 
threw the street into great excitement and 
it became at once the engrossing subject of 
conversation. The magnitude of the opera- 
tions of this institution throughout the West 
renders its suspension one of the most im- 
portant financial events since the Schuyler 
fraud, and fears are expressed that it may 
produce further commercial disasters. The 
house is by far the most important banking 
institution in Cincinnati, and the locking up, 
even temporarily, of its large deposits must 
prove very embarrassing to its dealers in. 
that city. The amount of its liabilities is 
not stated, but they are estimated at from 
five to seven millions. The annexed card 
has been received from the President: 

" 'Office of the Ohio Life & Trust Co. 
New York, August 24, 1857. 

"'The unpleasant duty has devolved upon 
me to state that this Company has sus- 
pended payment. This event has been 
mainly brought about in consequence of 
making loans in this city to parties who were 
unable to respond at this time. I would add 
that the capital of this Company, two millions, 
is sound and reliable, exclusive of such loss 



98 Story of Trust Companies 

as may arise from the insufficiency of securi- 
ties pledged for loans above referred to. 

"'C. Stetson, President.' 

"We learn that about seven hundred 
thousand dollars of checks were paid out by 
the agency here on Saturday and to-day 
were unpaid. The checks which were given 
to-day were again received by the Company 
and the drafts for which they were paid out 
were given up. 

" Messrs. Brown Bros. & Co. and others 
placed an attachment upon the assets of the 
Company here as a foreign corporation, and 
the Sheriff and his deputies are in charge of 
the office and property. The immediate em- 
barrassment of this Company arose, we under- 
stand, from its inability to meet loans made 
by it of some banking houses in the street. 
The proceeds of these loans had been used 
in sustaining Western Railroad Companies, 
one of which is said to have received advances 
exceeding half a million of dollars. This 
Company, although in its title a life insurance 
company, issued no policies on lives." 

On the next day, August 26th, in an editorial 
in the same newspaper entitled "Attack on 
Excess of Luxuries," it was declared that 



A Brokerage Failure 99 

"when banking concerns like the Ohio Life 
& Trust give way it is mere idle talk to pre- 
tend that the revulsion is fictitious or imagi- 
nary, and go on railing at the bears and the 
croakers, as has been the silly habit of some 
would-be leaders of opinion throughout the 
months past in which this storm has been 
probably brewing." 

The same day it was announced that John 
Thompson, a prominent Wall Street broker had 
been unable to meet his liabilities and from this 
time on the panic may be said to have been 
fully under way. 

Conditions at the home office of the Ohio 
Company have been described in Greve's 
History of Cincinnati, as follows: 

"On Wednesday, August 26, 1857, the 
Ohio Life Insurance & Trust Company 
failed to open its doors. Third Street be- 
came for a time the center of the city life. 
The morning papers had announced that the 
bank would not open and this drew an enor- 
mous crowd to this point. By nine o'clock 
it was impossible to pass through the streets. 
The crowd lingered all day long and the 
excitement was great. Fortunately there 



ioo Story of Trust Companies 

was no run at the time on other banks of the 
city. It was^felt that the trust company's 
misfortune was the result of bad management 
in its New York branch and there was every 
expectation that it would soon reopen its 
doors. As the news came in from New York 
during the day it became apparent that the 
matter was more serious than was supposed. 
The liabilities of the company were estimated 
by the Tribune at from five to seven millions, 
and the assets of the bank to the extent of 
two millions were attached by foreign credi- 
tors. It soon became apparent that the 
stockholders would lose everything. This 
seemed all the more remarkable as the stock 
had sold in New York during the preceding 
week almost at par and, but a few days before, 
the directors themselves had bought a num- 
ber of shares. The local branch of the bank 
issued a statement of its affairs in Cincinnati, 
claiming to show assets of over five millions 
with liabilities of less than three millions, 
making an excess of assets over liabilities, 
exclusive of capital, almost two millions and 
a half. It became apparent very soon that 
the demoralization in financial circles was 
not confined to any one institution. The 
Central Bank of Messrs. Hatch & Langdon 
finally suspended payment, to be followed 



Cincinnati's Part in the Panic 101 

a little later by the Citizens (Smead, Collard 
& Hughes) and the City Bank. All these 
institutions claimed to have assets largely 
in excess of their liabilities. The return of 
the investigating committee, composed of 
W. W. Scarborough and Wm. Hooper, who 
had been sent East to examine into the affairs 
of the trust company, brought little consola- 
tion to Cincinnati financial circles. It was 
perfectly clear that the company was a wreck. 
The hope that the difficulties would be tided 
over very soon disappeared. The trust com- 
pany checks fell to 25 cents on the dollar 
and the market generally showed great 
weakness. In October came the general 
suspension of the New York Bank, followed 
quickly by suspension throughout the country. 
The Ohio banks, however, fared better than 
most of the banks of the country, and although 
there was great distress as a result of the 
scarcity of money and a panic thoughout the 
country, there were no further failures. It 
became necessary, however, by reason of the 
hard times to distribute food to the poor 
citizens, which was done at public expense." 

During the closing months of 1857, and along 
in 1858, disaster overtook the banks in almost 



102 Story of Trust Companies 

every quarter. The most serious breakdowns 
were in the West. The Illinois free banks, 
having no real capital except security bonds 
in the hands of a State Auditor, were forced 
to meet a rise in Eastern exchange of no less 
than 15 per cent, premium. Lists of banks 
with the rates at which their notes would 
be received in trade appeared under the title 
of "Bank Note Reporters.' ' These were dis- 
played in the stores and in railroad and brokers' 
offices, and were even published in the news- 
papers. There were lists for merchants, bank- 
ers, railways, and the values of circulating notes 
changed constantly and without notice. By 
i860, banking establishments throughout the 
entire West saw their assets, securing issues of 
notes, lodged in the hands of public officials, 
but with constant and serious depreciation in 
the values of both the securities and the notes. 
In the South many bank failures occurred and 
the distress and confusion which ensued affected 
all lines of business. Specie payments were 
discontinued in New York from October 14, 
until December 14, 1857, and a widespread 
unsettlement of banking affairs existed for 



Merchants' Loan & Trust Co. 103 

several years thereafter, in fact until the passage 
of the National Banking Act in 1863. 

In spite of conditions like these a group of 
Chicago financial men saw their way in 1857 
to establish there an institution which in our 
times is recognized as being the oldest American 
trust company, organized as such, of those 
doing business west of the Atlantic seaboard. 

This was The Merchants' Savings, Loan & 
Trust Company, which featured its plan of a 
savings department in the original title but 
abandoned the idea until 1902, having about 
twenty years previously changed its corporate 
title to The Merchants' Loan & Trust Company. 

Back in 1857 the original capital was fixed 
at $500,000, with liberty to increase to $2,000,000 
under a term of life of fifty years. By 1907, 
the Company's fiftieth anniversary, its capital 
had become $3,000,000. Down to the present 
there never has been a consolidation, nor has the 
business of any other company been absorbed. 

Intimate details of the early history of 
The Merchants' Loan & Trust Company are 
mainly a matter of tradition, owing to the dis- 
astrous ravages of the great Chicago fire of 



104 Story of Trust Companies 

October 8, 1871. While all money and valu- 
ables were safely withdrawn, most of the books 
and records of the Company were destroyed 
in the vaults, and practically no legible details 
remained of some six hundred accounts involv- 
ing a sum of about two million dollars. Under 
extraordinary confusion and public excitement 
the Company resumed general business on the 
ninth day after the outbreak of fire, and at 
once began what seemed the insuperable task 
of adjusting its affairs. By the end of the 
year, however, such progress had been made 
that only some doubtful claims remained to 
be settled, but even these, although apparently 
indicating a loss to the Company of about 
$58,500, were in a short time paid in full. 
Back in the early days there was occasion for 
the Company to issue some circulating notes. 
These were put out as a defensive measure, 
and the issue of the notes must be considered 
unique among trust company policies of the 
last sixty years. 

The first offices of the Company were located 
in the building at the northwest corner of 
South Water and La Salle Streets, until i860, 




w 



o 
U 



Directors of Eminence 105 

when a change was made to the Dickey Build- 
ing, at the southwest corner of Lake and Dear- 
born Streets. While still here, in 1871, the 
great fire occurred and business was temporarily 
transacted at the residence of Solomon A. 
Smith, then President of the Company, until 
the spring of 1872 when quarters were taken in 
the Manierre Building. In 1881 the Company 
moved to the Portland Block, from which in 
1900 it changed to its present location, The 
Merchants' Loan & Trust Building at Adams 
and Clark Streets. 

The Presidents have been, in succession: J. 
H. Dunham, 1 857-1 862; Henry Farnam, 1862- 
1863; Solomon A. Smith, 1 863-1 879; John 
Tyrell, 1879-1884; J. W. Doane, 1884-1898; 
and Orson Smith, 1898-19 16. The last named 
is now Chairman of the Board and Edmund D. 
Hulbert is President. 

The Company has been happy in its relations 
with a number of men of commanding genius 
and influence who have helped to guide its 
affairs. On the same board of directors sat 
Marshall Field, Cyrus H. McCormick, George 
Armour, and George M. Pullman. On the 



106 Story of Trust Companies 

death of Marshall Field in 1906, his estate was 
bestowed in trust with the Company, a testa- 
mentary trust the size and importance of which 
had never to that time been equaled. Four 
years later, upon the death of Chief Justice 
Melville W. Fuller, of the United States Supreme 
Court, it was found that he too had named the 
Company to be the executor of his will. 

The growth of this important central western 
institution during late years, with some com- 
parisons of growth on the part of the older trust 
companies of the East, will be recorded in the 
next chapter. 

An event of world-wide moment occurred 
in 1858, when the first Atlantic cable message 
passed between Queen Victoria and President 
Buchanan, its wording, "Glory to God in the 
highest, and on earth peace, goodwill toward 
men/' Small indeed was the glimpse then 
to be had by business people, including the 
trust company men of that period, into the 
coming years when this invention was, by 
conjoining two great continents, to afford 
instantaneous intercourse regarding the million- 
dollar affairs of modern days. 



CHAPTER VIII 

1865. SIX PIONEER COMPANIES. GROWTH 
SINCE THE CIVIL WAR 

The story of the trust companies down to 
the time of the Civil War has been told. Of 
the concerns organized before 1865 with original 
trust powers and destined to survive until our 
own times, there were six great pioneers, the 
Farmers*, the New York Life, the Pennsylvania 
Company, the Girard, the United States, and 
the Merchants' of Chicago. These stand alone, 
for no record appears of any other trust com- 
pany which now survives having been char- 
tered, as such, between the years 1848 and 1864 
inclusive. In their beginnings, marked mainly 
by timid efforts to unite fire and life insurance 
undertakings with a business as fiduciaries, 
the ground work was laid for the great futures 
of each, as well as of their later imitators. 

From now on, however, most of the quaint- 

107 



108 Story of Trust Companies 

ness and much of the public misapprehension 
which so long existed fades away as we come 
to some individual narratives of how the com- 
panies have grown and thrived during the half 
century just passed. 

On June 30, 19 15, there were seventy trust 
companies in the United States, each of which 
had upwards of fifteen millions of dollars of 
total resources. The pages which follow will 
be generally devoted to accounts of their 
marvelous accomplishments since 1865. 

Of the sextette of pioneers, the Farmers' 
Loan & Trust Company, the oldest in point of 
privilege to execute trusts, has always main- 
tained first place, although to-day, 191 6, there 
are three other companies, the balance sheets 
of which present larger aggregates. These 
are the Guaranty (New York Guaranty & In- 
demnity Company, 1864- 1890), the Bankers, 
and the Central, all sister institutions in the 
great city of New York. Some of their achieve- 
ments will be related farther along, but the 
reader's attention is now invited to the stories 
of the original six institutions chartered for 
trust business between the years 1822 and 1857. 




New York Stock Exchange and office of the New York Guaranty 
& Indemnity Company, Broad Street, 1866. 



Growth of the Farmers' 109 

The Farmers' Loan & Trust Company re- 
mained in Wall Street until 1868. During 
almost fifty years since, it has occupied a 
building of its own at the corner of Exchange 
Place and William Street. The Presidents of 
the institution since 1836 have been: Robert 
C. Cornell, 1843; Dow D. Williamson, 1846; 
Rosewell G. Rolston, 1865; and Edwin S. 
Marston from 1898 to date. 

As the first of the trust companies it has had 
identified with it many other names of promi- 
nent New Yorkers, among which may be men- 
tioned Thomas Tileston, Shepherd Knapp, 
Moses Taylor, Daniel Drew, and Cornelius 
Vanderbilt. 

A forty-year comparison of its balance-sheet 
totals shows an ever increasing volume of 
assets. They have been: 

In 1876, June 30th $ 6,922,679.79 

In 1886, December 1st 23,320,041.73 

In 1896, June 30th 35,930,609.00 

In 1906, June 30th 79,876,966.98 

In 1916, June 30th 173,001,686.14 

This last total, which also appears at the 
conclusion of this volume, made the Company 



no Story of Trust Companies 

in the summer of 191 6 the fourth in size in the 
country. 

The Farmers' of to-day is an institution of 
$1,000,000 of capital, and with nearly eight 
times that amount held in surplus and undivided 
profits. It employs more that three hundred 
officers and clerks, has a local branch in Fifth 
Avenue, and takes care of foreign commitments 
with agencies in London, Paris, and Berlin. 
Its annual dividends are at the rate of fifty 
per cent, paid upon stock now quoted at $1600 
per share, which quotation is the highest in 
the list of New York City trust companies. 
It is America's oldest trust company; there is 
none better known or more widely respected. 

The New York Life Insurance & Trust 
Company remained under William Bard as 
President until 1843. In succession came 
Stephen Allen and John R. Townsend, until 
1846. For twenty-five years thereafter David 
Thompson was the Company's head, and from 
1871 to 1916 Henry Parish has made a record 
of the longest executive administration of 
affairs ever enjoyed by any trust company. 
As it is, Mr. Parish continues his labors as 



Growth of - ' New York Life " 1 1 1 

> 
Chairman of the Board. In 191 6, after forty- 
five years of untiring service, a new incumbent, 
Walter Kerr, succeeded to the presidency. 

The Company has prospered since the days 
of 1830. Witness total resources, since the 
dates already accounted for, as follows: In 
1876, thirteen millions; in 1886, nineteen mil- 
lions; in 1896, twenty-eight millions; in both 
1906 and 1 91 6, forty millions. Among its 
present liabilities are $1,000,000 of capital 
stock, $4,000,000 of surplus and undivided 
profits, and annuity and life insurance funds, 
maintained as of old but now amounting to. 
nearly $3,000,000. The stock now pays 45 
per cent, dividends annually. Down to July 
1, 1 91 6, the aggregate dividends paid had 
amounted to $20,280,000, or 2028 per cent, 
upon the Company's $1,000,000 of capitaliza- 
tion. The present bid price of the stock is 
$970 per share. 

This splendid old institution " accepts only 
private trusts and declines all corporation or 
other public trusts." It has numbered among 
its trustees one generation after another of 
eminent New Yorkers. As an example, be it 



ii2 Story of Trust Companies 

remembered that three Astors have sat upon 
the board, beginning with the original John 
Jacob, one of the sixty-one incorporators. 

Since 1830 the Company has always made 
Wall Street its home. In 1871 the address 
became No. 52, and there to-day, although 
scorning some modern devices, even registry 
in the telephone book, the offer is publicly made 
of "Protection for Widows, Children, and Old 
Age," while the days of old are kept in memory 
by announcements that even in 191 6 the institu- 
tion "allows interest on depo sites" 

Like its New York confreres, the Pennsyl- 
vania Company for Insurances on Lives and 
Granting Annuities has progressed during all 
the years since its reorganization with trust 
powers in 1836. 

Its presidents since 1857 have been but four: 
Charles Dutilh, until 1873; Lindley Smyth, 
until 1893; Henry N. Paul, until 1899, and 
C. S. W. Packard to date. The offices since 
1890 have been at No. 517 Chestnut Street. 
In that year a site was obtained opposite the 
State House. On the spot where the old 
American Hotel had stood a massive building 



"Pennsylvania Company" 113 

was erected containing what was then famous as 
"the largest banking room in the world." 

There the "Pennsylvania Company" has 
thrived, enjoying a substantial trust business 
and showing during thirty years past a growth 
in resources and liabilities of from fourteen 
millions in 1896 to twenty-three millions in 
1906, with a grand total in the summer of 
1 91 6 of forty- three millions of dollars. The 
capital is now $2,000,000, the surplus and un- 
divided profits, $5,300,000. The shareholders 
receive regularly twenty-eight per cent, divi- 
dends on their holdings. 

The fourth of our pioneer companies, the 
Girard of Philadelphia, after the death of 
Mr. Richards, the first President, in 1851, 
continued an uneventful but thrifty business 
during some years. From the beginning of 
the 1857 panic to the end of the Civil War, its 
dividends were never less than seven and one- 
half per cent. 

In 1 86 1, responding to a call from the Com- 
mittee of Public Safety, organized to raise 
funds for the defense of Philadelphia, the 
Company contributed its pro rata share; in 



ii4 Story of Trust Companies 

1862, a subscription was made to the Bounty- 
Fund for Volunteers, and in 1863 another to 
the fund for raising troops. 

The offices were removed from time to time 
upwards on Chestnut Street, and after several 
such moves, owing to the need for enlarged 
quarters, the institution in 1908 took up its 
home in the beautiful building it still occupies 
at the northwest corner of Broad and Chestnut 
Streets. 

Philadelphia experienced some little financial 
depression for a year or two following the 
closing of the Centennial Exposition, but after 
this anxiety was removed the Company entered 
upon a period of steady and pronounced growth. 
In 1878 the business of life insurance was 
discontinued; by 1887 the Company's deposits 
subject to check amounted to about one million 
of dollars and its trust estates to about ten 
millions of dollars; these figures to-day are 
$47,000,000 and $188,000,000 respectively. 
The capital was increased to $1,000,000 in 1886, 
and to $2,000,000 in 1899, when the present 
title was adopted, Since 1901 it has been 
$2,500,000, and the present surplus is nearly 



Girard Trust 115 

$9,000,000. The Girard Trust Company in 
recent years has paid thirty-six . per cent, divi- 
dends ($900,000 per annum) on its capital and 
in this respect divides honors with one other 
great institution of that city, hereinafter to be 
described, the Provident Life & Trust Com- 
pany of Philadelphia, which annually distri- 
butes $360,000 to the holders of its $1,000,000 
of share capital. 

It is worthy of special note that the Girard, 
immediately after its incorporation, paid a first 
dividend in 1837, and that notwithstanding 
panics and financial upheavals in the country 
there has been only one break in the dividend 
record — that of a semi-annual disbursement in 
1842. The figures of total assets twenty years 
ago, ten years ago, and in 191 6 have been 
$12,000,000, $43,000,000, and $54,000,000 re- 
spectively. 

Only three Presidents have succeeded Mr. 
Richards, namely, Thomas Ridgway, 1851- 
1883; John B. Garrett, 1883-1887; and Effing- 
ham B. Morris, during whose incumbency of 
almost thirty years the Company's notable 
growth has been achieved, and to whose wise 



n6 Story of Trust Companies 

foresight was due trie erection of the first 
imposing financial building in Philadelphia 
in a section which, largely on that account, has 
become the financial center of the city. 

The United States Trust Company of New 
York, as has been shown, started business at 
No. 40 Wall Street. From 1858 to 1865 it was 
at No. 48 Wall Street; until 1887 it was at No. 
49 Wall Street, opposite; and since then its 
home has been in the building known as No. 
45 Wall Street. 

From 1868 to 1903 John A. Stewart served 
as President. In the latter year, which was 
the Company's fiftieth anniversary, he was 
appointed Chairman of the Board of Trustees. 
This was a relief from arduous and confining 
services without, however, depriving the Com- 
pany of his knowledge and experience and the 
benefit of his counsel and advice. To-day, 
1916, Mr. Stewart, after having entered the 
Company's service sixty-three years ago and 
with but a single interruption, while he acted 
as Assistant Treasurer of the United States, 
during the Civil War, is still to be found at his 
desk each day attending as of old to the re- 



"United States' ' and "Merchants' " 117 

sponsible affairs of the Company. After 1903, 
Lyman J. Gage, who had been Secretary of the 
Treasury, took up the duties of President, 
being succeeded three years later by Edward 
W. Sheldon. 

The Company's growth during forty years 
past will be seen from the following tabulation 
of resources and liabilities: 

1876 June 30 $26,050,641.61 

1886 December 14 41,058,004.94 

1896 December 31 48,650,127.26 

1906 June 30 70,918,857.64 

1916 June 30 80,955,731.66 

Included in the present liabilities are $2,000,000 
capital stock and $14,400,000 of surplus and 
undivided profits. The annual dividend rate 
is fifty per cent, and the stock is quoted at 
$1035 per share. 

The sixth of the pioneer companies, The 
Merchants' Loan & Trust Company of Chicago, 
was sketched in the previous chapter. A word 
must be added, however, regarding its growth 
since 1896, when the Company's balance sheet 
showed a total of $16,000,000, increasing in 
1906 to $58,000,000, and in 1916 to $84,000,000. 



n8 Story of Trust Companies 

It is in order here to show one or two illus- 
trations of the sort of services which trust 
companies render. At this period, issues of 
securities and investments therein were natu- 
rally on a most limited scale, as compared with 
present-day issues and investment holdings. 
But from about this time it became the practice, 
less as an experiment and more with recogni- 
tion of the fitness of the trust companies to act 
in representative capacities, for corporations, 
associations, and individuals to avail of the 
facilities now to be described. 

Modern practice requires that a railroad or 
industrial corporation desiring to issue bonds 
shall execute a deed of trust, conveying the 
property, securing the bonds to a trustee, who 
upon the face of the bonds certifies that the 
property has been so pledged, that the issue 
is on certain terms, and that each bond is one 
of the total number issued. This duty is now 
almost invariably performed by a trust com- 
pany, which arranges also, when desired, to 
register the ownership of the bond, paying 
interest thereon by check instead of upon the 
presentation of coupons. In a similar manner 



Functions Illustrated 119 

a trust company will act as registrar of an 
issue of stock, another company recording 
transfers of ownership of the shares; this leads 
to the certification of stockholders* lists for 
dividend purposes; and all of these services 
are performed in consideration of regular fees, 
which contribute largely to the gross income of 
the company. Among other services rendered 
may be mentioned the duty of acting under 
appointments as executor, administrator, guar- 
dian, and as committee. Corporate and indi- 
vidual trusts are also undertaken involving 
the deposit of money and securities, the prin- 
cipal and income of which are to be devoted to 
specific purposes. Sometimes these deposits 
are made until reorganization arrangements can 
be effected. Occasionally they are subject to 
distribution under escrow agreements, and 
almost always the trust company is asked, and 
consents, to assume responsibilities involving 
the safeguarding of property, or to exercise 
discretion in its management to a degree beyond 
that which individuals would care to employ, 
or would be warranted in having entrusted to 
them. 



120 Story of Trust Companies 

Among thousands of commitments of this 
character one or two modern appointments of 
the trust companies already described will be 
made to serve as outlining these functions. 

The Farmers' Loan & Trust Company now 
registers some $30,000,000 of capital stock of 
the Delaware, Lackawanna, and Western Rail- 
road and over $170,000,000 of capital stock of 
the New York, New Haven, and Hartford Rail- 
road. Since 1896 it has been trustee under an 
issue of Northern Pacific Railway General Lien 
and Land Grant Gold three per cent, bonds. 
The authorized issue is $190,000,000 and this 
trust will continue until the maturity of the 
bonds in the year 2047. 

In the late summer of 19 16 the United King- 
dom of Great Britain and Ireland turned to 
the United States for financial aid, arranging a 
two-year five per cent, loan of $250,000,000, 
secured by some $300,000,000 of stocks of 
American corporations and bonds of the Domin- 
ion of Canada and other foreign governments. 
In appointing a trustee, as custodian for this 
vast gathering of wealth from abroad, under a 
pledge agreement executed by the Government 



A Notable Modern Trusteeship 121 

of the United Kingdom, the choice fell upon 
The Farmers' Loan & Trust Company. With- 
out describing the great volume of labor re- 
quired in the handling of these securities, it 
will be possible to judge somewhat of the magni- 
tude of such a transaction when it is stated that 
the mere task of certifying the bonds issued 
under this agreement has lately, and within 
the space of a few days of time, required the 
officers of the Farmers' to affix their names to 
bonds containing no less than 165,000 signatures. 



CHAPTER IX 

INCORPORATIONS FROM 1 865 TO 1 868 

As we look back to the dark days of 1864 in 
the Nation's history, it is worthy of special 
mention that one great American trust com- 
pany should have been started at such a time. 
This was the Union Trust Company of New 
York, incorporated April 23, 1864, and opened 
for business in 1865 at No. 73 Broadway. 
This first address was at the corner of Rector 
Street, where the Company was domiciled 
for nearly twenty years. Its first President 
was I. H. Frothingham. Toward the end of 
this period the building became famous as 
the scene of an attempt upon the life of Russell 
Sage, who was there attacked by the insane 
bomb thrower, Norcross. Mr. Sage was one 
of the Company's early Trustees. The boards 

in the early years also included a number of 
122 



Union of New York 123 

other prominent financiers, among whom may- 
be mentioned David Dows, Robert Goelet, 
Abiel A. Low, James S. Wadsworth, and Cor- 
nelius and William H. Vanderbilt. 

In 1876 the Company's total assets amounted 
to nearly $11,000,000; in 1886 they were $26,- 
000,000; in 1896, $39,000,000; in 1906, $53,000,- 
000; and in 191 6, $95,000,000. 

Throughout the thirty-five years ended 1908 
Edward King served as President. During 
the following year John W. Castles acted in 
that capacity. Since 19 10 Edwin G. Merrill 
has been President. 

In 1886 the Company received an appoint- 
ment as trustee under a deed of trust which 
has been, and will long continue to be, famous 
for the length of term of the bonds secured 
thereby. This covered the issue by the West 
Shore Railroad of $50,000,000 of first mortgage 
four per cent, bonds, due 475 years after their 
date, that is in the year 2361. 

The Union Trust Company made it a rule, 
long before the days of statutory reserves being 
compulsory, to keep large sums of cash on hand 
to secure deposits. This fund was mostly in 



124 Story of Trust Companies 

gold and was maintained from 1884 onward in 
an amount which never fell below $3,000,000, 
and was sometimes larger. This voluntary- 
practice was always deemed, both within and 
without the Company, to be on lines of the 
utmost of prudence and conservatism. 

The Company to-day has $3,000,000 of 
capital and $5,500,000 of surplus and undivided 
profits. Dividends were paid in 19 15 at the 
rate of seventeen per cent. The stock sells 
at $380 per share. 

The offices for years have been in the Com- 
pany's own building at No. 80 Broadway. 
Recently there have been two uptown branches 
established, one at Thirty-eighth Street and 
Fifth Avenue; the other on the same Avenue, 
fronting Central Park at Sixtieth Street. 

On Third month 22-, 1865, eighteen days 
before Lee's army laid down their arms before 
General Grant and the Union forces at Appo- 
mattox, a charter was bestowed upon the Provi- 
dent Life & Trust Company of Philadelphia. 
This was the third great institution to be formed 
in the City of Brotherly Love. The organiza- 
tion was brought about by a few members of 



Provident Life of Philadelphia 125 

the Society of Friends. Thirty-three years 
previously some members of that Society had 
established the Friends' Provident Institution 
of Bradford, England. Its operations were 
confined to insurance of the lives of birthright 
Friends, and its experience had shown a re- 
markably low mortality, owing to the excep- 
tional longevity among the members of that 
sect. Accordingly, these Friends of a genera- 
tion later, attracted by the success of the earlier 
institution, felt drawn to the idea of life insur- 
ance, and since a capital stock was a legal 
requirement for that business, had the charter 
include the authority to transact a trust busi- 
ness also, the profit from which should remune- 
rate the stockholders, it being provided that 
the entire surplus in the insurance department 
should accumulate for the benefit of the policy 
holders, so that the only advantage, direct or 
indirect, which the stockholders could at any 
time have from the union of the two features 
of the business would result from the fact that 
the management of the trust business, from 
which they derive their profit, would be done 
for them without charge. 



126 Story of Trust Companies 

The proposed business was not, however, 
to be confined to Friends, but dealings were to 
be had with "others of like careful habits." 
The Company's first President was Samuel R. 
Shipley. It began business in a basement at 
No. 247 South Third Street, and the records 
show that on Tenth month I--, 1865, the build- 
ing at No. in South Fourth Street was leased. 

The very early records contain many quaint 
facts, as viewed in the light of larger develop- 
ments in later years. For example, on Tenth 
month 9-, 1865, the minutes recorded: "The 
engagement on trial of Joseph R. Smith as City 
Canvasser," and a month later that he had 
"given up the position, for physical disability 
after a trial of one and a half weeks." That 
the Company was provident in practice as well 
as in name, is shown in the record of "the pur- 
chase on very favorable terms from the North 
American Transit Insurance Company of the 
desks and office furniture required for the new 
office at No. in South Fourth Street." 

The capital was increased in 1871, by sub- 
scription, to $500,000, and two years later the 
Company moved into its own building at No. 



A Half Century of Service 127 

108 South Fourth Street. The Company's 
President at the present time is Asa S. Wing, 
who has been in its service since 1867, first as 
assistant actuary, later, and until 1906, as 
vice-president and actuary. 

The Provident Life & Trust in 1879 took up 
quarters in its own building at No. 409 Chest- 
nut Street, where it still continues to transact 
an insurance and trust business. It is one of 
the very few life insurance institutions having 
both life insurance and trust departments. 
In 1866 the deposits were reported at $78,109.69. 
By 1875, the total resources were about $2,6c v 
000. In 1885, they were a shade over $9,000,000. 
Ten years later, in 1896, the aggregate had 
increased to approximately $40,000,000. The 
totals for 1906 and 191 6 were $73,000,000 and 
$105,000,000, respectively, the figures for the 
latter year composing insurance assets of 
$83,960,190.51 and assets apart from insur- 
ance of $21,354,620.13. On June 30th of the 
year last named the Company's capital was 
$1,000,000 and its surplus and undivided profits 
upwards of $5,500,000. The annual dividend 
rate is thirty-six per cent. 



128 Story of Trust Companies 

Again in Philadelphia, in 1866, was seen 
the birth of a new trust company known as 
the Fidelity Insurance Trust & Safe Deposit 
Company. As will be seen from the Company's 
title, insurance, fidelity and trust plans were 
supplemented by authority "to receive upon 
deposit for safekeeping, jewelry, plate, stocks, 
bonds, and valuable property of every kind." 
In all the early advertisements of the Company 
great stress was laid upon this function. It 
was the first concern to be known as a safe 
deposit company in Philadelphia and its objects 
were stated in the first prospectus in the 
following words: 

"The great wealth of the country, the 
vast amount of Government and other Loans, 
transferable by delivery, and held by the 
uncertain tenure of possession, the injury 
and inconvenience resulting from the loss of 
these and registered securities, demand a 
means of protecting such property from the 
risks of Fire, Accident, Robbery and Theft, 
which no arrangements hitherto existing 
have afforded. A place of absolute safety 
for all such securities has become a 
pressing necessity. It is to supply this that 



Fidelity of Philadelphia 129 

the present Institution has been founded. 
It is the purpose of the Managers to provide 
for their depositors every security against 
fire, depredation, or accident, which archi- 
tectural and mechanical skill can combine in 
the structure and material of their building, 
vaults, and safes. The location of their 
building — between the First National Bank 
and the Bank of North America — is in itself 

a GUARANTEE OF SECURITY difficult to sur- 
pass. The internal police of the office has 
been organized with special care, and there 

will be A CONSTANT NIGHT-WATCH INSIDE THE 

premises; and to this is to BE SUPER- 
ADDED THE PROTECTION OF A LARGE CAPITAL." 

The interest with which the enterprise was 
at first received, was largely increased by the 
frequency of burglaries of banks and of offices, 
which occurred before the incorporation and 
for a few years afterwards. Among these may 
be mentioned the robbery of the Common- 
wealth Bank of Philadelphia in 1865, and of a 
ninety thousand dollar loss from the same 
cause by Cochran & Co., wine merchants on 
Walnut Street. This occurred in 1866, and 
in the same year the Hartford Bank experienced 



130 Story of Trust Companies 

similar troubles. Other alarming robberies 
occurred at about the same time, sixty thousand 
dollars from the Mechanics Fire Insurance Co. 
of New York and large sums from the Ocean 
Bank of New York, the Boyleston Bank of 
Boston, the Third National Bank of Baltimore, 
and the Consolidated Bank of Louisiana. In 
1869 a large robbery occurred in Philadelphia 
at the Beneficial Savings Fund Society, Twelfth 
and Chestnut Streets, and two years later 
another took place at the Kensington National 
Bank. 

Of all these great thefts the most sensational 
was that at the Kensington National Bank, 
which occurred in February, 1871; it was re- 
ported that $120,000 of bonds were taken. 
The burglars obtained an entrance into the 
Bank upon the pretense of being police sent 
by the authorities to prevent an alleged intended 
robbery, and in this case, as in the others, it 
was determined that the Bank had not been 
guilty of such negligence as would render it 
liable. 

The effect of the feeling of insecurity caused 
by these depredations was that safe deposit 



Fifty Years of Progress 131 

companies sprang up in various parts of the 
country, the Fidelity being the second to appear, 
one in New York having preceded it by but a 
short time. Similar companies were started 
in Cincinnati, Baltimore, and other cities. 
Emphasis upon this branch of the Company's 
business from its inception down to the present 
year, has made the clause "Security from loss 
by burglary and robbery, fire or accident" a 
most effective feature of publicity. 

The Company was opened for business on 
September 1, 1866. Its first President was 
Clarence H. Clark, who was succeeded by 
N. B. Browne and then by Stephen A. Caldwell, 
who in turn was followed by John B. Gest in 
1890. For fifteen years following 1900, Rudulph 
Ellis was President, being succeeded in 19 15 
by William P. Gest, who had been Vice-Presi- 
dent since 1900. 

The Company's offices to-day are at No. 
325 Chestnut Street, the title having been short- 
ened to read Fidelity Trust Company. Since 
the time half a century ago, when a modest 
beginning was made with $250,000, of capital, 
gradual increases of the stock have occurred 



132 Story of Trust Companies 

until the outstanding shares now amount to 
$4,000,000, with surplus of over $13,000,000. 
The dividend rate in recent years has been 
twenty-four per cent. The total resources 
have been in round numbers: 1876, $12,000,000; 
1886, $18,000,000; 1896, $19,000,000; 1906, 
$42,000,000; and 1 916, $47,000,000, without 
including trust funds. 

Among numerous important testamentary 
trusts which have been committed to the Com- 
pany the best known, perhaps, has been an 
appointment dating back to 1894 by Richard 
Smith who died in that year. Under its terms 
a sum not exceeding $500,000 was devoted to 
the erection in Fairmount Park, of a monumen- 
tal granite memorial containing statues of a 
number of distinguished Civil War generals 
and admirals, of which the most conspicuous 
are Generals Hancock, McClellan, Meade, and 
Reynolds. This magnificent memorial was 
duly erected in Fairmount Park under the 
trusteeship of the Fidelity Trust Company, 
which was directed further to spend $50,000, 
in the erection of a proper building and the 
enclosing of a children's playground in the 



Brooklyn Trust Company 133 

Park. This worthy undertaking was duly 
established in 1899, and has since that date 
been continuously maintained under the di- 
rection of the trustee. 

The companies hereinbefore described — that 
is, the ones which have endured down to the 
present — were all New York, Philadelphia, or 
Chicago companies. In 1866 a charter was 
taken out by a Brooklyn institution. At that 
period the population of what is now Manhat- 
tan Borough was less than nine hundred thou- 
sand, while Brooklyn was an independent city 
of about three hundred and fifty thousand. 
This new undertaking was known as the Brook- 
lyn Trust Company. It has had a phenomenal 
growth in total resources. These amounted 
in 1876 to less than $2,000,000; in 1886, 
$9,500,000; 1896, $12,000,000; in 1906, $20,- 
000,000. The statement of June 30, 191 6, 
shows upwards of $47,000,000. 

Ripley Ropes was President during the early 
years and was succeeded by General C. T. 
Christ ensen, who, upon his death in 1903, 
was in turn succeeded by Theodore F. Miller. 
Edwin P. Maynard has been President since 



134 Story of Trust Companies 

1 9 13. The Company has for many years 
made its home at No. 177 Montague Street, 
adjoining Clinton Street, where on a plot run- 
ning through to Pierrepont Street a handsome 
modern building is at the time of this writing 
about completed. 

The Company's capital stock twenty years 
ago was $300,000. In 1913, the Long Island 
Loan & Trust Company was absorbed, itself 
one of the prominent institutions of Brooklyn. 
The capital at this time is $1,500,000, with 
surplus and undivided profits of approximately 
$4,000,000. The stock pays dividends at the 
rate of twenty per cent., and, in addition, extra 
dividends from time to time, and commands a 
price of $520 per share. Among developments 
of recent years may be mentioned the estab- 
lishment of a branch office at Fulton Street and 
Bedford Avenue, Brooklyn, and a Manhattan 
office at the corner of Wall Street and Broadway. 

First in the New England field, mingling the 
ideas of preservation of life and conservation 
of wealth, the Rhode Island Hospital Trust 
Company began its career in 1868. 

As to the origin of its name, one of the original 



Rhode Island Hospital Trust 135 

incorporators in speaking of the early history 
of the Company, stated: 

"It owed its existence to the desire of a 
few public-spirited men to create what should 
be a financial institution of high credit and 
powerful resources, and at the same time 
prove a pecuniary helper to the Rhode Island 
Hospital, a benevolent institution then in 
its infancy.' ' 

Under a section of its charter the Company 
was required : 

"To pay over, annually, to the l Rhode 
Island Hospital,' for its use, one-third 
part of all the net profit upon the capital 
stock of said corporation over and above six 
per cent, thereon. This obligation shall 
continue so long as no similar act of incorpora- 
tion shall be granted by the legislature of 
this State to other parties than the corporators 
herein." 

By mutual agreement and under a subse- 
quent settlement with the Rhode Island Hos- 
pital, this section became inoperative. The 
early association of the two institutions was 
helpful to both and the friendly relations of 



136 Story of Trust Companies 

the early years have continued to the present 
time. 

The story of this Providence institution is 
one of constant growth in both banking and 
trust undertakings. As far back as 1876 the 
balance sheet footed $7,000,000; by 1896 this 
aggregate had more than doubled to over 
$15,000,000; in 1906 the total was approxi- 
mately $30,000,000. 

In that year an important local bank was 
acquired, the American National, and since 
1909 when the capital (shares $1000 each) was 
increased from $1,000,000 to $2,000,000, and in 
191 1 to $2,500,000, the Company has moved 
steadily onward. To-day its reported surplus 
and undivided earnings amount to over $3,500,- 
000 (inclusive of $330,000 of guaranty and 
improvement funds), while its total resources 
and liabilities have risen to the sum of $55,630,- 
437.74, making it the third company in size 
in New England. Herbert J. Wells has acted 
as President during more than thirty years 
past. 

An important Cleveland institution, estab- 
lished in 1868, will be next in order of considera- 



The Bankers Almanac of 1868 137 

tion, but before describing it in the succeeding 
chapter a word or two will be of interest as 
showing how little the trust company idea was 
understood, and how small a part the several 
companies were deemed to have in the country's 
entire banking affairs even as late as the year 
1868. A glance at some of the features of a 
financial directory published in that year, the 
Merchants and Bankers Almanac of 1868, reveals 
the names and some of the particulars regarding 
no less than 1650 national banks, 270 State 
banks, and 1400 private and savings banks. 
To these a list was appended of 600 fire, marine, 
and life insurance companies. Statistics were 
shown for fluctuations in the price of gold, 
English consols for 135 years, and iron, cotton, 
hops, and molasses, the two last-named articles 
being priced for over forty years previous. 

The only reference, however, to a trust com- 
pany was a one page advertisement of the 
National Trust Company, then at No. 336 
Broadway and fated within the next few years to 
disappear from the little group of trust corpora- 
tions which might then have been given a place 
in such a reference book, but which were not 



138 Story of Trust Companies 

until many years later inserted in the "blue 
books" and cyclopedias, along with their con- 
temporaries, the banks. As far along as the 
early nineties it was the exception, not the rule, 
to find references made in such publications to 
trust company directorates. 



CHAPTER X 

PROGRESS FROM 1 868 TO 1 873 

We come now in our story to the founding 
in 1868 of one of the greatest financial institu- 
tions in the Central West. This was the Citi- 
zens Savings & Loan Association which, as 
the result of various mergers has become the 
Citizens Savings & Trust Company, the oldest 
and largest trust company in Ohio. 

It was in 1903 that three of Cleveland's 
best known financial institutions, the Citizens 
Savings & Loan Association, the Savings & 
Trust Company, and the American Trust Com- 
pany, were consolidated under the title of the 
Citizens Savings & Trust Company, each con- 
tributing a large measure of financial strength, 
and each bringing its quota of depositors and 
patrons. 

The Citizens Savings & Loan Association 
139 



140 Story of Trust Companies 

began business in temporary offices in the Wed- 
dell House Building on lower Superior Street. 
Some time later it moved to the Wade Building 
at No. 1 08 Superior Street where it remained 
until 1894, when it moved to larger offices on 
the ground floor of the Case Building, the site 
of which is now in part occupied by the Post- 
Office Building. 

The institution remained in its location in 
the Case Building until the consolidation above 
referred to, when a magnificent new fourteen- 
story building, the Company's present home, 
was erected. 

Among those comprising the first directorate 
of the Citizens Savings & Loan Association 
were such well-known names as Jeptha H. Wade, 
who was President until his death in 1890, U. 
S. Senator Henry B. Payne, and George Worth- 
ington. From 1878 to 1881, President James 
A. Garfield was a member of the Board and 
Secretary of State John Hay served as a Director 
from 1883 to 1893. 

The Savings & Trust Company was the first 
trust company organized in the State of Ohio. 
It opened for business in May, 1883, in the 



Citizens' of Cleveland 141 

Benedict Building on Euclid Avenue and sub- 
sequently purchased the property on Euclid 
Avenue now occupied by the Union National 
Bank, in which building it remained until the 
consolidation in 1903. 

The American Trust Company commenced 
business in 1898 in the American Trust Build- 
ing on the west side of the Public Square and 
occupied these quarters until the consolidation 
five years later. 

The Citizens Savings & Trust Company 
conducts its business along the most conserva- 
tive yet at the same time thoroughly efficient 
lines. Its loans are made exclusively on real 
estate first mortgages or on approved collat- 
eral. It maintains a Foreign Exchange De- 
partment and conducts an extensive safe 
deposit business. It is well known throughout 
this country, and in many places abroad, as 
the Home of Banking by Mail, and in this 
department it handles many hundreds of 
thousands of dollars. 

Its Trust Department has charge of trust 
estates amounting to many millions. Among 
the many trusteeships which have been handled 



142 Story of Trust Companies 

by the institution may be cited one or two 
special cases. 

The late Benjamin Rose left an estate valued 
in excess of $3,000,000 to the Citizens Savings 
& Trust Company, as trustee in perpetuity, and 
directed the trustee to organize and superintend 
an institution for the purpose of distributing the 
entire net income of the estate to deserving old 
men and women. By this arrangement monthly 
payments are made to many people, enabling 
them to remain in their own home instead of 
having to go to some charitable institution. 

The late Robert R. Rhodes left an estate 
valued at $2,000,000 the bulk of which was left 
to the trust company, as trustee in perpetuity, 
and the income is to be paid to various hospitals 
and charitable organizations in Cleveland. 

From an institution of about $8,000,000 of 
resources twenty years ago, the Citizens Sav- 
ings & Trust Company has grown until its 
latest statement, issued on the last day of June, 
1916, showed total resources of $70,661,825.82, 
with capital of $4,000,000, surplus and undi- 
vided profits of $3,498,823, and deposits of 
$62,962,790.32. 



New England Trust Company 143 

J. H. Wade, son of the original President of 
the Citizens Savings & Loan Association is 
Chairman of the Board of Directors. H. R. 
Newcomb, who was President from the time of 
the consolidation in 1903 until his death in 19 10, 
was succeeded at that time by D. Z. Norton. 

Boston entered the trust company field in 
1 87 1, presenting for instant public approval 
the New England Trust Company, which had 
been chartered two years previously. The 
Company's offices were at No. 76 Devonshire 
Street, later at No. 85, almost directly across 
the street, and in 1906 a handsome building 
was erected at the corner of Milk and Devon- 
shire streets. The early Presidents were Amos 
A. Lawrence and Otis Norcross, followed by 
Wm. Endicott, Jr., and David R. Whitney. 
Since 19 12 James R. Hooper has acted in that 
capacity, and in 191 5 George Wigglesworth 
became Chairman of the Board. 

The growth of the Company has been con- 
stant and the progression of total assets since 
1876 shows: in that year, $6,000,000; in 1886, 
$12,000,000; in 1896, $15,000,000; in 1906, 
$18,000,000; in 1916, $29,000,000. 



144 Story of Trust Companies 

The present capital is $i ,000,000, the surplus 
and undivided profits $2,992,786.32. 

Entirely in line with earlier endeavors in 
the same city, the Philadelphia Trust, Safe 
Deposit & Insurance Company came into 
corporate existence in 1869. As indicated by 
the title, several distinct functions were contem- 
plated, and not until 1 91 5 was the name 
Philadelphia Trust Company adopted. 

The early Presidents were J. Livingston Er- 
ringer and W. L. DuBois. This office was held 
by Roland L. Taylor in 19 10 and 191 1, by 
Samuel L. Heebner in 1912, and since 1913 
Thos. S. Gates has been the Company's head. 
The institution is a strong one. Its capital of 
$1,000,000 now carries with it surplus and un- 
divided profits of $5,000,000, and the growth in 
assets since 1906 has been from a total of $12,- 
000,000 to a present volume of over $30,000,000. 

The year 1869 also saw a new incorporation 
in Chicago. This was the Union Trust Com- 
pany which during late years has been domiciled 
at No. 7 South Dearborn Street, corner Madison 
Street, its earlier home having been at No. 145. 
Back in 1896, under the presidency of S. W. 



Illinois Trust & Savings 145 

Ransom, it was a modest concern of $500,000 
capital, $900,000 surplus and undivided profits, 
and $4,500,000 of total resources and liabilities. 
Since 1905, Frederick H. Ransom has been 
President and the corresponding figures for 
June, 1916, are $1,500,000, $1, 600,000, and 
$34,500,000, respectively. 

The great Chicago fire of October 9, 1871, 
played sad havoc with the city's financial 
possessions. Most of the banks and trust 
companies there were equipped with vaults of 
old-fashioned types of construction, and the 
losses in cash securities and records were, in 
some instances, complete. For many days 
after the conflagration was ended there was an 
entire suspension of financial activities, and 
not until months after was business resumed 
on anything like a normal basis. 

In 1873, however, the newly created metro- 
polis of the West saw the corporate foundation 
laid for a great institution known as the Illinois 
Trust & Savings Bank. 

This concern has always held high rank among 
the trust companies of the country. As far 
back as 1896 its report showed footings of no 



146 Story of Trust Companies 

less than $30,000,000; in 1906 the extraordi- 
nary total of $106,000,000 was reached, at that 
time the largest sum of resources of any trust 
company; to-day, 1916, with $5,000,000 of 
capital, $11,000,000 of surplus and undivided 
profits, and $128,000,000 of total liability, it 
is the seventh company in size in the country. 
The present offices are in a substantial banking 
house at No. 233 South La Salle Street, where 
for over twenty years past John J. Mitchell has 
devoted himself to the duties of President of 
the institution. 

In the late summer of 1873 came a severe 
panic which both interrupted existing trust 
company arrangements and offered many dis- 
couragements to new undertakings. The 
troubles of that period were precipitated by 
public distrust of the Government's financial 
policies ; there had been reckless over-extensions 
among the railroads and other corporations; 
speculative tendencies had developed to a degree 
previously unheard of. When the crash came 
in Wall Street, the chief scene of the difficulties, 
it was not unnatural that some of the trust 
companies should be affected. 



Panic of 1873 147 

During that summer two institutions in 
what is now Greater New York were forced to 
suspend for short periods. In one instance 
it was claimed that the management was lack- 
ing in diligence in the handling of certain city- 
funds, the newspapers asserting that it had 
not acted in good faith in the surrender to out- 
siders of some large quantities of securities. 
At least two of these newspapers had libel suits 
filed against them before matters quieted down 
and the company was able to resume business. 

In September, 1873, began a series of Stock 
Exchange failures which greatly unsettled 
public confidence. Fisk & Hatch of New York 
and Jay Cooke & Company of Philadelphia 
were among the many great brokerage houses 
to go to the wall. The closing months of the 
year witnessed many stirring events in New 
York, a notable instance being the trial and 
conviction of the city boss, William M. Tweed. 
The period was one of great financial distress 
and of constant accusations and recriminations 
among persons high in public authority, but 
the trust company embarrassments of 1873 
were short-lived and seem now, in the light cf 



148 Story of Trust Companies 

minutes and other records which have been pre- 
served, to have been considerably exaggerated 
in the press accounts of that year's happenings. 

Returning now to the New England field, 
the story of the Boston Safe Deposit & Trust 
Company illustrates the want of co-operation 
on the part of the investing public which the 
founders of many prominent trust and safe- 
deposit companies had to experience and over- 
come. Originally incorporated in 1867 by 
special act of the Legislature, under the title 
Boston Safe Deposit Company, it was author- 
ized, by amendment in 1874, to assume the 
present corporate name, to conduct a banking 
business, and to act as registrar of stocks and 
bonds and as transfer agent. 

Yet it was not until June 1, 1875, that the 
Company began business, confining itself to 
safe-deposit transactions until July 2, 1876, 
when a banking department was established. 
It is recorded that Edward P. Bond, who ob- 
tained the charter, actually carried the docu- 
ment about in his pocket for eight years trying 
to interest investors in the possibilities which 
he foresaw in a safe-deposit business. 



Boston Safe Deposit & Trust 149 

The original capital of the Company was 
$200,000, which was doubled in 1876 after one 
year's business; in 1890 it was increased to 
$1,000,000, which remains the capital at the 
present time. 

In 1877 the Company was given authority 
by the Legislature to act as trustee under will, 
and in 1899 it was appointed by the Bank Com- 
missioner as executor under wills, as adminis- 
trator of estates and as guardian of minors and 
incompetents. These were the first instances 
of such powers being granted to trust companies 
in the Commonwealth. The Company at pres- 
ent holds in trust over $30,000,000, the largest 
amount so held by any trust company in Mas- 
sachusetts, and the deposits of its banking 
department have increased from $500,000 in 
1877, to $16,000,000, without the absorption 
of any other institution. 

The offices and vaults of the Company are 
located in its own modern building, No. 100 
Franklin Street, the former and original quar- 
ters having been at No. 8^ Milk Street. 

The Presidents have been Francis M. John- 
son, 1875 to 1877; Frederick M. Stone, 1877 to 



150 Story of Trust Companies 

1897; William E. Putnam, 1897 to 1905; Charles 
E. Rogerson, 1905 to date. 
The growth of resources: 

1876—$ 935,281.94 1896—$ 9,034.758.94 

1886— 4,539,618.48 1906— 15,695,909-86 

1916— $20,833,008.01 

The present capital is $1,000,000, the surplus 
and undivided profits $3,216,378.13. 

Chartered in 1873, opened for business in 
1875, the Central Trust Company of New York, 
always among the most progressive of trust 
companies, is in 191 6 the third largest in the 
United States. In the beginning, Henry F. 
Spaulding was elected to the presidency and 
offices were opened at No. 14 Nassau Street, 
which were occupied until 1884. The Com- 
pany then removed to the building directly 
opposite, at No. 15 Nassau Street. 

It was at about this time that Frederic P. 
Olcott, former Comptroller of New York State 
(1878-1879), became President of the Company. 
In 1887 the quarters at No. 15 Nassau Street 
were outgrown and a new location was chosen 
at No. 54 Wall Street in the shadow of the old 



Central of New York 151 

Custom House. This building is to-day almost 
as intimate a landmark of lower New York as 
its venerable neighbor across the street, and 
it has been the home of the Central Trust 
Company from 1887 to the present time. 

In 1876, one year after commencing business, 
the Company reported resources of $5,263,302.50 
and about the time of removal to the present 
address, in July, 1887, the figures were $22,- 
521,975.59, a growth of over seventeen millions 
of dollars. 

From 1896 to 1906 the surplus and undivided 
profits grew from $6,242,995 to $15,214,974.99, 
while the total resources reached $83,004,867.52, 
in striking testimony of the methods and poli- 
cies of Mr. Olcott. Upon his being elected 
Chairman of the Board of Trustees in 1905, 
the present incumbent, James N. Wallace, 
was elected President. Mr. Olcott continued 
as Chairman of the Board of Trustees until his 
death in 1909. 

The capital stock, which had been $1,000,000 
since the inception of the Company, was in 1909 
increased to $3,000,000 by means of a dividend 
of $2,000,000. In July, 191 6, a dividend of 



152 Story of Trust Companies 

$2,000,000 was paid to the shareholders, at 
which time the capital stock was increased to 
$5,000,000. 

As of June 30, 1916, the Company reported 
surplus and undivided profits of $18,258,793.74 
and total resources of $175,484,519. Its present 
holding of this vast aggregate of wealth makes 
the Company third in size in New York City 
as well as in the United States. 

The Central Trust Company has been distin- 
guished at all times as an institution composed 
of prominent financiers. The late J. Pierpont 
Morgan served some years as a Trustee. The 
late John S. Kennedy was also a Trustee until 
his death. The Company is famous for the 
liberal treatment it shows its officers and 
employees, old and new; the annual Christmas 
gifts are fifty per cent, of the year's salaries. 
Since 19 14, an uptown branch has been main- 
tained at Forty-second Street and Madison 
Avenue. 



CHAPTER XI 

I874 TO 1876. FIRST SUPERVISION. EARLIEST 
STATISTICS 

A lull ensued between 1872 and 1881, so 
far as new trust incorporations were concerned, 
but within this period two notable events oc- 
curred. One was the first administering any- 
where of a law compelling examinations by 
State authorities, the other a gathering for the 
first time of any figures for trust companies 
worthy the name of statistics. 

Prior to the year 1872 there was practically 
no State supervision of trust companies. Some 
of the companies, in compliance with their 
charters, reported to the courts, while others, 
by virtue of their character, reported with the 
insurance companies. 

In the year mentioned Connecticut enacted 
a supervisory law and soon afterwards the 

153 



154 Story of Trust Companies 

functions of the trust companies, as well as the 
differences between them and the State banks 
began everywhere to be better understood. 
During 1874, New York passed laws whereby 
trust companies came under the supervision 
of the Banking Department (existing since 
1 851), were compelled to make annual reports 
to the Superintendent, and were subjected to 
yearly examinations. Ohio enacted a trust 
company law three years later but annual 
examinations were not authorized until 1908. 
It was also as late as 1908 before the Superin- 
tendent in New York State could take charge 
of an unsound trust company. 

Vermont first required reports in 1878, and 
Louisiana and Maine, in 1882 and 1883 re- 
spectively, were the next to take the step. Of 
the larger States, Illinois followed in 1887. 
Some of the Massachusetts companies, under 
provisions of their charters, reported to the 
bank commissioners as early as 1870, although 
the Legislature did not require this until 1888. 

Pennsylvania's Legislature was as late as 
1 89 1 in passing regulative laws. Such had the 
confusion been in this State that back in 1852 



Need of Control 155 

and 1853 only one of the State's two companies 
had reported, apparently to the Legislature; 
while as late as 1878, six reported to the Auditor 
General, three to the Superintendent of Insur- 
ance, and one independently of any department. 
In California, West Virginia, and Colorado, trust 
company supervision was contemporaneous with 
that of Pennsylvania. 

Thirty- three years after the legislation in 
New York, that is in 1907, a count of the States 
showed that forty-five of them had passed trust 
company laws, though in the majority of 
cases these laws were almost identical with those 
governing State banks, some prescribing more, 
some fewer, requirements. 

The searcher of public documents cannot fail 
to be impressed with the inconsistency of all 
this. Until a date nearly a hundred years 
after the Nation's birth the trust companies 
were really so many free lances. How valu- 
able would the record be now if we could look 
back to complete figures by States during the 
early years. There are elaborate old docu- 
ments relating to almost every subject, from 
legislative junkets on the River Nile to the 



156 Story of Trust Companies 

most approved methods of oyster cultivation 
along our own shores; there have been governors' 
messages printed in foreign languages, and 
great illustrated tomes have now and then 
appeared on subjects like pomology, piscato- 
logy and paleontology; but scientific control 
of trust companies by the State governments 
was an unheard-of study as lately as forty-five 
years ago. 

In the seventies the abuses of the earlier 
years began over again. In New York State, 
Governor Cornell ruled in a veto message, as 
late as 1881, that the Bankers' Life Insurance 
& Trust Company of New York, incorporated 
by special charter in 1871, was not entitled to 
change its title by ehminating the word "Trust " 
therefrom. He remarked: 

"Diligent inquiry among bankers, trust 
companies and commercial agencies in New 
York has afforded no information as to the 
existence or operations of the Company. 
It would seem that a corporation which has 
been so prolific of legislation should not be 
permitted to occupy an additional space in 
the statutes of the State, at least until it 



New York Companies in 1874 157 

shall have made for itself a local habitation 
and a name by which it can, upon inquiry, 
be found. The failure to report to the Bank- 
ing Department, as required by its charter, 
is another reason why the change of name 
should not be assented to at this time." 

Just how a condition like this could have 
existed is not clear, for under Chapter 324 of the 
Laws of 1874 °f New York State, which was 
entitled: "An act relative to moneyed corpora- 
tions, other than banks, institutions for savings, 
and insurance companies," it had been pro- 
vided that every trust, loan, mortgage 
security, guaranty or indemnity company or 
association, having the power and receiving 
money, was required semi-annually on June 
30th and December 31st in each year to make 
a report to the Banking Department. 

This statute, as already stated, compelled 
the Superintendent of Banks to make a visit 
once each year at the offices of the corpora- 
tions thus placed under his authority, and 
to examine their condition. As of the end of 
the same year the Superintendent was able 
to report what was then a very imposing 



158 Story of Trust Companies 

aggregate of capital and deposits for the Empire 
State. He said: 

" Under the law passed at the last session 
of the Legislature, reports were made on the 
30th of June last by twelve moneyed corpora- 
tions, variously styled trust, or loan, or 
indemnity or guaranty, or mortgage com- 
panies. These reports show that the com- 
panies have an aggregate capital of $11,752,- 
040. Their deposits amounted to $38,479,764, 
a sum which is nearly three-fifths as much as 
the entire deposits held by the State banks. 

"In the endeavor to procure reports from 
this class of companies, it was discovered 
that many of them which have been incor- 
porated during the last few years have made 
no organization, while some others which 
have been organized have languished and 
failed in the end. It is believed that every 
company which is subject to the provisions 
of the law mentioned, is embraced in the re- 
ports which are elsewhere given. They show 
the several companies to be apparently in a 
sound condition, although the statement of one 
of them exhibits an impairment of capital. 

" During the present year the examination 
of these companies will be made as the law 
provides." 



Views of Federal Comptroller 159 

That methods of supervision were needful, 
and had long been so, was clearly pointed out 
by the Comptroller of the Currency at Wash- 
ington, at the beginning of 1874. 

Commenting upon his report issued at that 
time, the Bankers Magazine presented the fol- 
lowing interesting remarks on the subject of 
supervision : 

"The Comptroller alludes to the trust and 
loan companies which have grown up in late 
years and now assume a large space in New 
York City and in various cities of New Eng- 
land. Properly managed, these institutions 
are not only useful but necessary. They 
were intended as repositories for trust funds, 
for accumulation of deposits to be loaned on 
mortgage, and for investments in government 
loans, in other words as Savings Banks on a 
large scale. Recently they have been con- 
verted into stock-jobbing concerns, appar- 
ently for the benefit of stock operators and 
in large sums ; thereby defeating their original 
objects and contributing to the demoraliza- 
tion of stock speculators. Call loans are 
among the active causes of a panic, and bank- 
ers handle them at a great risk. The Comp- 
troller's views are as follows: 



160 Story of Trust Companies 

"'These companies are actually organized 
by special State Statutes in the large cities. 
Their capitals, deposits, and business are 
quite large in amount. Generally, if not 
always, they are not required to report to 
the State authorities, but under the orders 
of one or other of the courts. Some of these 
occur at long intervals and are probably 
published in the newspapers, but even when 
so published they are by no means full, and 
furnish but little available information. For 
instance, one of the largest of these institu- 
tions, has published but one report in a year 
and that report contains only a statement of 
its assets, without any mention of the amount 
due to its depositors or any of its liabilities. 
The bank Superintendent of New York in reply 
to an inquiry in reference to these institutions 
says (Under date of 31st July, 1873) : 

" "'The trust companies of New York are 
peculiarly situated. Some are under the 
supervision of the bank department; some 
are under the control of the Comptroller of 
the State, but the great majority of them are 
under no sort of supervision. This class of 
corporation (meaning the last described) 
has multiplied rapidly during the last few 
years. I am not able to furnish a copy of 
the charter of any of these companies. ,,! 



First Comprehensive Statistics 161 

The New York Superintendent's report for 
1874 ma y he said to have constituted the first 
public showing ever made by a banking depart- 
ment of the aggregate position of a group of 
trust companies. It was only a forerunner, 
however, of some most interesting figures soon 
to be presented by Comptroller of the Currency, 
John J. Knox, than whom no person in public 
life has ever contributed more to the complete- 
ness of enduring bank statistics. 

In the Comptroller's report to Congress for 
1875-1876, was set forth the following: 

Table of Aggregate Resources and Liabilities of 
Trust and Loan Companies 

Resources: 1874-1875 

J5 " banks" 



Loans and discounts $65,900,174 

Overdrafts 16,883 

United States bonds 2,086,842 

Other stocks, bonds, etc 37,323,062 

Due from banks 1,837,605 

Real estate 3,733,357 

Other investments 2,880,342 

Expenses 92,894 

Cash items 5,186,004 

Cash — legal — tenders, bank-notes, etc 3,833,012 

Total $122,890,175 

IX 



162 Story of Trust Companies 



Liabilities: 1874-1875 

35 "banks' 



Capital stock $21,854,020 

Surplus fund 6,967,693 

Undivided profits 582,867 

Dividends unpaid 18,921 

Deposits 85,025,371 

Due to banks 121,441 

Other liabilities 8,319,862 

Total $122,890,175 

Accompanying this exhibit the same accounts 
were shown in detail by States, the aggregates 
being: 

Massachusetts 5 "banks" $ 9,033,335 

Rhode Island 1 " 6,694,862 

Connecticut 10 " 5,711,438 

New York 12 " 69,654,948 

Pennsylvania 7 " 31,795,592 



Total $122,890,175 

In a footnote was added the fact that: 

"The financial editor of the Chicago Tribune 
states that the liabilities of five trust com- 
panies in the City of Chicago on June 30, 
1875, were: Capital $2,500,000; surplus, 
$725,000; deposits, $5,688,574. But this 
statement, being unaccompanied by the 



1 875 Aggregates 163 

resources of these banks could not be made 
available for the purpose of this report." 

It was also explained that in New York State 
the deposits were inclusive of "$3,696,344 of 
money in trust." 

The Comptroller discussed the figures of the 
trust companies with care and explained that: 

"among the States from which either no 
reports were received, or such as could not 
be utilized, are the great States of Illinois, 
Ohio, Virginia, Louisiana, Missouri, and 
many others." 

■ At this point, forty years ago the little story 
of thirty-five reporting trust companies must 
have made small reading, in contrast with the 
Comptroller's showing of other kinds of institu- 
tions, of which there were: 

2086 National Banks footing for $1,823,000,000 

674 Savings Banks footing for 896,000,000 

551 State Banks footing for 272,000,000 

reporting altogether almost three billions of 
dollars, or about twenty-five times the modest 
122 millions of trust company resources. 



164 Story of Trust Companies 

The Comptroller made no mention of a con- 
cern located in the District of Columbia having 
the title of "Real Estate Loan & Trust Com- 
pany." This institution seems to have existed 
in Washington from 1877 to 1880. Its capital 
was $100,000, and it issued "real estate bonds 
secured by deeds of trust" on property as 
far away as Tennessee. A specimen "bond" 
is here shown in fac-simile. Readers familiar 
with the appearance of national bank currency 
in years gone by will detect a similarity. In 
fact, the size, form and texture of these "bonds " 
were all strikingly in keeping with Uncle Sam's 
own demand bank obligations of the same 
period. 

During the five years following the issuance 
of the report above described the growth of the 
companies, as stated by the Comptroller of 
the Currency, came almost to a standstill. The 
Rhode Island Hospital Trust Company, which 
has been previously sketched, continued to 
appear in the Comptroller's tabulations, but 
in every other State, between 1876 and 1880, 
there were decreases in the numbers of the 
companies and even a slight falling off in the 




o 

6 

O 

o 



VO 
00 



A Slowing Down in Activities 165 

summaries of their aggregate resources. The 
items and totals thereof were: 

1876 38 companies $127,646,179 

1877 39 " 123,612,499 

1878 35 " 110,843,603 

1879 32 " 111,809,936 

1880 30 " 126,869,673 

The Federal Comptroller's reports were not, 
of course, based upon complete information from 
all State sources, but a searching of current 
and modern records would make it appear that 
during the years 1877 and 1878, not a single 
trust company incorporation was effected in 
the entire United States. 

It seems strange that directly upon the ad- 
ministering of the new law at Albany, and the 
issuance of some live figures at Washington, 
there should have been displayed such inactivity 
among the old concerns, with an utter lack of 
interest in the formation of new ones. Yet it 
is a fact that at this period trust company 
activities hesitated, and the tide of their progress 
ran at a very low ebb. 



CHAPTER XII 

l88l TO 1888. INCREASING NUMBERS OF 
COMPANIES 

The onward march was resumed in the early 
eighties, new incorporations occurring in many 
quarters. The next of the very large companies 
arose in New York City, when on December I, 
1 88 1, the Metropolitan Trust Company of the 
City of New York opened modest quarters at 
No. 41 Pine Street. 

The first president of the Company was 
General Thomas Hillhouse, who had been serv- 
ing as Assistant Treasurer of the United States, 
with headquarters at the New York Sub- 
Treasury. General Hillhouse had a notable 
career as a banker and State and Government 
official. Previous to assuming his duties at 
the Sub-Treasury, he had served as Adjutant- 
General under Governor E. D. Morgan during 

166 



Metropolitan of New York 167 

the troublous times of the Civil War, and had a 
term as Comptroller of the State of New York. 
He had also been a member of the New York 
State Senate. 

The Company at its formation had an author- 
ized capital stock of $1,000,000 with authority 
to increase to $2,000,000. It continued to 
operate under the smaller capitalization, how- 
ever, until January 30, 1903, when following the 
successful termination of a series of important 
negotiations, the Atlantic Trust Company, 
which in former years had been one of the 
strongest of Wall Street institutions, was 
merged into the Metropolitan Trust Company. 
In order to bring about this union, the capital 
stock of the Metropolitan Trust Company 
was increased to $2,000,000 and in the merger 
two shares of Atlantic Trust Company stock 
were exchanged for one share of Metropolitan 
Trust Company Stock. 

Shortly after its beginnings on Pine Street, 
the offices of the Metropolitan were moved to 
No. 17 Nassau Street, on the site of the present 
Equitable Life Building, and thence a removal 
occurred afterwards when a change was made 



168 Story of Trust Companies 

to a more advantageous location in the Mills 
Building at No. 35 Wall Street. The banking 
quarters at the latter address were continued 
until the Company went to its own building at 
No. 37 Wall Street, in 1888. The location of 
the offices was once more changed in 1904, to 
the Atlantic Mutual Insurance Company Build- 
ing at the corner of Wall and William streets, 
where they are now maintained. 

Upon the retirement of General Hillhouse in 
1898, General Bray ton Ives was chosen presi- 
dent, and served until 1912, when George C. 
Van Tuyl, Jr., took office. Mr. Van Tuyl was 
formerly president of the Albany Trust Com- 
pany and had been appointed Superintendent 
of Banks under Governor Dix, in 191 1. During 
his term at the head of the Banking Department, 
Governor Dix appointed the Van Tuyl Com- 
mission which was charged with the responsible 
duty of revising the State's banking laws. 

The growth of total assets of this Company 
has been steady and consistent. In 1886 there 
were reported $5,787,174.20; in 1896, $10,763,- 
138.50; in 1906, $35,470,279.90; and in 1916, 
$80,584,022.85, while surplus and undivided 



Title Guarantee & Trust 169 

profits show an increase of over five millions 
of dollars from 1896 to date. 

In 1883 appeared the Title Guarantee & Trust 
Company of New York. Its beginnings were 
on the eighth floor of No. 2 Wall Street, using 
two hundred feet of floor space. 

In a recent magazine article, Clarence H. 
Kelsey, who has been President of the Company 
almost from the beginning, says of those early 
days: 

"Our address was all that could be desired, 
but the elevators stopped running shortly 
after six o'clock, and if my work required me 
to return after dinner, I had to climb seven 
flights of stairs. When I compare these 
Spartan beginnings with the facilities of the 
ten story building on Broadway now owned 
and occupied by us, I am satisfied that we 
have accomplished the thing we set out to do 
— to create a business by providing a title- 
insurance service of a type which would be 
accepted as indispensable in local real estate 
transactions. 

"When our fight began, we had many 
hard problems to solve. The Register's 
office contained deeds, mortgages, and other 



170 Story of Trust Companies 

real estate instruments covering a period of 
more than three hundred years. These 
were recorded chronologically and indexed 
under the names of the parties to the in- 
struments." 



Accordingly, the Company set out to abstract 
the essential portions of all recorded instruments 
and to separate and index them according to 
locality. Antagonism developed from the first 
on the part of the great law firms which then 
controlled the real estate conveyancing busi- 
ness, and of the Register and the official search- 
ers who drew large incomes from their plants, 
and from their personal knowledge of the very 
confused sets of records which existed in public 
offices. Years of diplomacy, litigation, and 
hard work ensued but as time went by the 
records were copied, indexed, and ready to use. 
By degrees standard rates were made covering 
the examination of titles, all searches, and poli- 
cies of title insurance. These rates were well 
below the fees previously charged by the law 
offices. Later the organization was made to 
cover a business getting department; clients 



Expertness in Title Work 171 

were furnished with purchase money mortgages 
to help them complete their purchases; an 
energetic band of young attorneys was gathered 
and trained to expertness in the matter of title 
examination and closing; speed was developed 
to the point of cutting down the time of exam- 
ining a title, which before the days of the Com- 
pany had taken from perhaps thirty to sixty 
days, so that now the claim is made that the 
Company can take care of almost any new title 
in a week or less and of a re-examination in 
twenty-four hours. Eventually the important 
business of selling guaranteed mortgages was 
developed to a degree unequaled by the record 
of any other similar concern. The Company 
from the beginning has been a firm believer in 
publicity. To-day it is without doubt the 
most widely advertised trust company in the 
country, using newspaper space, pamphlets, 
cards in the trolley cars, elevators, and subway 
trains, and annually distributing 150,000 copies 
of an attractive calendar. The Company's 
total resources in 1886 were less than $800,000. 
In 1896, they amounted to $5,877,352.78, and 
on June 30, 1906, to $46,675,307.69, while on 



172 Story of Trust Companies 

the same day ten years later they were reported 
at $51,890,767.66. 

In 1903, the Company absorbed the Manu- 
facturers Bank of Brooklyn, which is to-day one 
of the Company's branches. In 1896, the capi- 
tal stock was $2,500,000; it is now $5,000,000. 
The surplus and undivided profits have grown 
in the last ten years from less than $7,000,000 
to upwards of $12,000,000. With about 
$33>ooo,ooo f deposits, the Company has 
recently made the impressive statement that: 
"For each $100 of our customers' money, 
we have in addition more than $50 of our 
own." 

Philadelphia's leading title company dates 
from 1885, although the recording system for 
deeds has existed in Pennsylvania since 
1682, when the first act on the subject was 
passed. Among the acts and laws of the 
General Assembly of the Province of Penn- 
sylvania, 1 7 14-17 1 5, "being the First Year 
of the Reign of His present Majesty King 
George over Great Britain, France and Ire- 
land, etc.," was the Recording Act of May 
28, 1715: 



Pennsylvania Title Records 173 

" There shall be an office of record in each 
county of this province, which shall be called 
and styled the Office for Recording Deeds, 
and the Recorder shall provide parchment, 
or good large books of royal or other large 
paper, well bound and covered, wherein he 
shall record, in a fair and legible hand, all 
deeds and conveyances which shall be brought 
to him for that purpose." 

Other subsequent acts provided that recorded 
deeds and mortgages should be indexed, and 
that such entry "shall be notice to all persons." 
The above provisions have been continuously 
carried out to the present day, the only innova- 
tion being that the prescribed "fair and legible 
hand" has been supplanted by the legible 
typewriter. 

It was not until 1874, that the Pennsylvania 
Legislature authorized, by its general " Corpora- 
tion Act," the incorporation of companies for 
"the insurance of owners of real estate, mort- 
gages, and others interested in real estate, from 
loss by reason of defective titles, liens, and 
incumbrances." Prior to this Act (from 1836 
to 1874), a few Philadelphia companies had been 



174 Story of Trust Companies 

chartered with trust powers, but without title 
insurance powers. 

The first title company chartered under this 
act was The Real Estate Title Insurance & 
Trust Company, chartered in 1876. Gradually 
overcoming the local conservatism and opposi- 
tion of conveyancers and conveyancers' counsel, 
the system of insurance of titles made its way 
by inherent merit, and in 1885, a second com- 
pany was incorporated, The Land Title & 
Trust Company. 

It began business in 1885, in a rented room 
at No. 621 Chestnut Street, and within three 
years erected a large office building at No. 608 
Chestnut Street. Within ten years the increase 
of its business, and the prevision that business 
would in the future invade the neighborhood of 
the new City Hall, at Broad and Market Streets, 
resulted in the purchase by the Company 
of a new central site at the southwest corner 
of Broad and Chestnut Streets, and the erection 
of offices, with ample plant and safe deposit 
facilities. In 1903, this building was supple- 
mented with an adjoining big brother of twenty- 
two stories, into the entire first floor of which 



Land Title of Philadelphia 175 

the Company's offices have overflowed. That 
more than 182,250 title policies, and over 
155,000 certificates of search have been issued 
by The Land Title & Trust Company down 
to August, 1916, is evidence of the extent of the 
business. The losses by payment of indemnity 
for defects in title, undiscoverable or undiscov- 
ered at the time of issuing the guarantees, 

while a small percentage, are in the aggregate 

1 
a multitude. 

During the first ten years of the Company's 
existence, the banking department was some- 
what subordinated to that of title insurance, 
and in 1896, the resources were less than 
$4,000,000. In the next decade, how- 
ever, broadening activities in the former field 
were evidenced by assets of $15,226,529.04, and 
at the time of this writing, $21,184,939.52 are 
shown. 

To care for this expanding volume of business 
the original capital of $1,000,000 was doubled 
in 1904, and the surplus was gradually increased 
until it is now $5,000,000. 

The Company has had three presidents, 
Charles Richardson, August, 1885 to November, 



176 Story of Trust Companies 

1887; Nathaniel E. Janney, to November, 
1 891; and William R. Nicholson, serving since 
that time. 

Another important undertaking in the field 
of title insurance and trust business in New- 
York occurred four years later, in 1887, when 
the Lawyers Title Insurance Company was or- 
ganized and, as the name implied, undertook a 
business of title insurance with lawyers, until 
1900, when its scope was extended to cover the 
entire field of title examination and insurance. 
The original capital was $500,000. In 1905, 
trust company powers were acquired, the 
Central Realty Bond & Trust Company was 
absorbed and the name was changed to Law- 
yers Title Insurance & Trust Company; it so 
remained until 191 5, when upon taking over 
the Home Trust Company of Brooklyn, the 
present name, Lawyers Title & Trust Company, 
was adopted. 

The first offices of the Company were located 
in the old Equitable Building, No. 120 Broad- 
way, and afterwards in larger quarters at No. 
37 Liberty Street, from which in 1908 the 
Company moved to its new building at No. 



Fidelity of Newark 177 

1 60 Broadway. There are branch offices at 
No. 44 Court Street, and No. 188 Montague 
Street, Brooklyn. 

The founder and first president was Edwin 
W. Coggeshall, who continues to guide the 
prosperous course of the Company as Chairman 
of the Board of Directors, having in 191 5 been 
succeeded in the presidency by Louis V. Bright. 

The capital stock in 191 6 was reported at 
$4,000,000; the surplus and undivided profits 
at $5,263,000, and the total resources at $31,135, 
000. This last figure was a growth of nearly 
$12,000,000 during ten years past. 

New Jersey had for years been the home of 
several important trust companies, when in 
1887 a new institution appeared in Newark. 
Its able and progressive management soon gave 
it a conspicuous position, and for years it has 
been conceded to be the largest and strongest 
of such institutions in the State. It began 
business under the name of the Fidelity Title 
& Deposit Company which, however, was soon 
changed to Fidelity Trust Company. 

The institution was opened on May 1, 
1887, under a charter granted February 14th 

12 



178 Story of Trust Companies 

of the same year. Its original capital was 
$200,000, which has since been increased to 
$3,000,000, in addition to which the institution 
has a surplus of $2,000,000, and undivided 
profits of over $1,000,000. In 1901, its total 
resources were about $8,000,000, while at the 
present time, 1916, the Company reports more 
than $30,000,000. 

There have been two presidents, the first, 
Thomas T. Kinney, and the present incumbent, 
Uzal H. McCarter. During the last ten years, 
the Fidelity has acquired the following insti- 
tutions: Newton Trust Company, Newton 
N. J. ; Essex County Trust Company, and its 
branch, East Orange, N. J.; Union County 
Trust Company, Elizabeth, N. J. ; New Bruns- 
wick Trust Company, New Brunswick, N. J.; 
and Red Bank Trust Company, Red Bank, N. J. 

The bid price of the Company's stock in 
1906 was 750, and dividends of thirty per cent, 
were declared. With $2,000,000 capital, and 
$7,500,000 in surplus and undivided profits, 
the Fidelity's capitalization was readjusted in 
1 91 5. After special cash and stock dividends 
amounting to $7,500,000 had been declared 



Industrial of Providence 179 

and paid, the capital was increased to $3,000,000, 
upon which the institution now pays 20 
per cent, dividends. This year, 191 6, it also 
paid an extra dividend of 10 per cent. At 
the present time its new stock is quoted at 450. 

Rhode Island's largest trust company was 
incorporated under the title Industrial Trust 
Company, on June 9, 1886, and formally 
opened for business in Providence in August of 
the following year. 

Rooms in Custom House Street were occupied 
until the completion of permanent quarters 
in the Exchange Bank Building, Westminster 
and Exchange Streets and in December, 1887, 
the Company took possession. 
. Colonel Samuel P. Colt was the first Presi- 
dent, succeeded after twenty years of service, 
in 1907, by Cyrus P. Brown. Colonel Colt, 
since 1913, has been Chairman of the Board. 
In 1912, Colonel H. Martin Brown, the present 
managing executive became President. The 
Company has since 1894 occupied its own build- 
ing, a nine story structure erected partly on 
the site of the old Atlantic Insurance Building, 
at Westminster and Exchange Streets. It now 



180 Story of Trust Companies 

sustains eight branches in adjoining cities and 
towns. 

The original capital of $500,000 has been 
increased from time to time and now stands at 
$3,000,000, with surplus and undivided profits 
of $4,700,000, as against $326,000 in 1896. 
The Company's total resources have grown 
from $6,416,573 in 1896, and $50,514,749 in 
1906, to $65,438,423.59 at the present time. 

Among some prominent New Yorkers who 
have served on its directorate may be mentioned 
Levi P. Morton, James Stillman, George F. 
Baker, Thomas F. Ryan, Elbridge T. Gerry, 
and Jacob H. Schiff . 

The Franklin Trust Company was organized 
by the late Abiel Abbot Low and a group of 
other prominent Brooklyn men, and commenced 
business at No. 186 Remsen Street, Brooklyn, 
on August 1, 1888, with a capital of $500,000, 
increased a year later to $1,000,000. 

In 1892 the Company moved to the hand- 
some office building which it had erected at the 
corner of Montague and Clinton Streets, and 
also established the Franklin Safe Deposit 
Company which it controls. 



The Franklin of Brooklyn 181 

In 1904 the control of the Safe Deposit 
Company of New York was obtained, and a 
branch of the Trust Company was started 
over the office of the Safe Deposit Company 
at No. 140 Broadway. This branch is now 
located at No. 46 Wall Street. 

Besides the main office at No. 166 Montague 
Street the Trust Company now maintains three 
Brooklyn branches, one at No. 569 Fulton 
Street, near Flatbush Avenue, one in the Walla- 
bout Market, and one in the Navy Y. M. C. A. 
Building on Sands Street, the last having 
been opened for the convenience of sailors in 
the United States Navy. In 191 1 the Company 
was elected to full membership in the New York 
Clearing House Association. The Company 
has a large individual trust business in Brooklyn 
and has acted as executor and trustee for many 
of Brooklyn's prominent citizens. 

The institution has always been progressively 
advertised, and its frequent quoting of the 
maxims of Benjamin Franklin has been an 
effective, because humanly interesting, scheme 
of publicity. 

On December 31, 1896, nine years after the 



1 82 [ Story of Trust Companies 

Company's inception, the total resources were 
$7,000,000; ten years ago the aggregate was 
$18,000,000; on June 30, 1916, the $25,000,000 
mark was passed. . 

Edwin Packard, was the first President, 
serving until 1891, when he was succeeded by 
George H. Southard. In 1908, Arthur King 
Wood, the present incumbent, was elected. 

The mention of Mr. Wood's name is a re- 
minder of another trust company official whose 
term of service began almost one hundred years 
ago. This was his great-grandfather, John 
King, Assistant Secretary of the old Farmers 
Fire Insurance & Loan Company, in the early 
twenties of the past century. Later he became 
the Company's Secretary and labored in that 
capacity for many years. Mr. King was a strict 
Quaker; he always objected to having his por- 
trait painted, and no likeness of him is known to 
exist. About the year 1835 he had a premoni- 
tion that he was about to die and as the result 
resigned his office and settled up his affairs, 
passing away in December of that year, just 
at the time when the great fire in New York 
was raging. 



CHAPTER XIII 

I889 TO 189O. ADDITIONAL NEW COMPANIES 

There were several important incorpora- 
tions during trie year 1889. In a description 
of these, two immense institutions of the present 
day make their entry into our story; one in 
New York, the other in Pittsburgh. 

In that year the New York Trust Company 
began business under the title of New York 
Security & Trust Company. 

The offices were at No. 46 Wall Street, 
when, in 1904, the Continental Trust Company 
of the City of New York was absorbed. This 
latter institution, whose President was Otto T. 
Bannard, had, at the time of the merger, total 
resources of over $20,000,000, its share capital 
being $1,000,000. 

The New York Security & Trust Company's 
President, in 1904, was Charles S. Fairchild 

183 



184 Story of Trust Companies 

who had formerly held the high office of Secre- 
tary of the Treasury under President Cleve- 
land. At this time the total resources were 
$35,000,000. The enlarged Company had 
$3,000,000 of capital stock thereafter and Mr. 
Bannard became the President. The commo- 
dious offices of the former Continental Trust 
Company at No. 26 Broad Street were then 
chosen as the home of the merged institutions. 

In 1906, two years after the events described 
above, the New York Trust Company had 
assets of $59,730,496.58, and the surplus and 
undivided profits were $10,552,011.16. In 1916 
the totals were $94,457,922.23 and $11,372,284.- 
16 respectively. 

Mortimer N. Buckner is now President of 
the Company, having been elected in January, 
1916. 

Twenty-seven years ago a group of Pitts- 
burgh men, headed by A. W. Mellon, subscribed 
$125,000 of trust company capital and opened 
an institution for business in the Fidelity 
Building, No. 121 Fourth Avenue. Two years 
later the capital was doubled, but by 1896 the 
aggregate of capital, surplus, and deposits of 



Union of Pittsburgh 185 

the young institution, known as the Union 
Trust Company of Pittsburgh, was less than 
half a million of dollars. Where, unless in a 
city of such achievements as that in which this 
enterprise began, would it be expected to find 
at the end of twenty years an accumulation of 
more than two hundred times the amount of 
wealth reported after seven years of initial 
operations? For the Union Trust Company, 
on June 30, 191 6, was one of eleven concerns 
in the country having over one hundred millions 
of dollars of resources. 

Upon its directorate are such well-known 
names as those of Henry C. Frick and Philander 
C. Knox. 

With the tremendous growth of Pittsburgh's 
industries, the Company has thrived and en- 
larged during all the years, its one hundred and 
one millions of dollars of resources being about 
double the sum reported ten years ago, and 
representing at the present time over one 
seventh of the total bank and trust company 
resources of Pittsburgh. The present capital 
stock is $1,500,000, the surplus and undivided 
profits $34,000,000. 



1 86 Story of Trust Companies 

The shares are one hundred dollars par, their 
present book value about $2375 each, and the 
market quotation much higher. The various 
dividends paid during the past year, down to 
June 30, 1 91 6, have amounted in the aggregate 
to 146 per cent, upon the capital. 

The Company's offices at this writing are 
at No. 335 Fourth Avenue, where since 1900 
H. C. McEldowney has been President, having 
at that time succeeded J. S. McKean. 

Back in 1889, when Los Angeles was a city 
of fifty thousand inhabitants, the Security Trust 
& Savings Bank was started upon an eventful 
career. Its organizers subscribed to $29,000 
of capital and established headquarters for the 
new project in one small room in the Wiel 
Building at No. 148 South Main Street. The 
bank was organized by J. F. Sartori who still 
directs its affairs as President; M. S. Hellman, 
Vice-President, and W. D. Longyear, Cashier, 
became affiliated with the institution soon 
after its organization. In 1896, under the name 
of the Security Savings Bank, the office was 
moved to the corner of Main and Second 
Streets, with an enlargement of these quarters 



A Los Angeles Institution 187 

following in two years. Its remarkable growth 
was partly due to the great progress of the 
West about this time. By 1900 the resources 
were $2,000,000, in 1902 almost $4,000,000, 
and in 1904 over $10,000,000. 

One of the factors in the institution's growth 
was its absorptions of various other concerns. 
In 1904 the Main Street Savings Bank was 
acquired, it having been started the same year 
as the Security. Along with a change to the 
Hellman Building in the same year, came the 
absorption of the Los Angeles Savings Bank, 
founded in 1887. At the time of the 1907 panic 
the Security took over the interests of the 
Southern California Savings Bank, a large 
institution founded in 1885, and in the following 
December another change in location was made 
to the corner of Fifth and Spring Streets. A 
further acquisition was made in 19 12 when it took 
over the Equitable Savings Bank, the founders 
of which were W. J. Washburn and Willis Booth. 
Shortly afterward the Southern Trust Company 
was acquired, and the institution from this 
period may be said to have entered upon a 
trust company business in the fullest sense. 



188 Story of Trust Companies 

The reports of 1909 showed resources of 
$20,000,000 and 48,000 deposit accounts. On 
June 30, 1916, the capital was $1,800,000, the 
surplus and undivided profits $2,045,000, the 
entire balance sheet showing an aggregate of 
assets of $51,000,000, making it, in this respect, 
the strongest concern engaged in trust company 
business west of Chicago. 

One of Chicago's leading institutions, the 
American Trust & Savings Bank, organized in 
1889, for a time having as its President G. B. 
Shaw, and later Edwin A. Potter, was taken 
over by the stockholders of the Continental 
National Bank in August, 1909. Under the 
arrangement then effected, all of the stock was 
acquired by the stockholders of the Continen- 
tal & Commercial National Bank, and the 
title changed to Continental & Commercial 
Trust & Savings Bank. The institution is 
allied with the present great Continental & 
Commercial National Bank of Chicago, both 
companies being presided over by George M. 
Reynolds as President. The concern is fourth 
in point of size among trust companies in the 
Central West. It occupies quarters in the 



New England's " Foremost" 189 

Continental & Commercial Bank Building at 
No. 208 South La Salle Street, and reported, 
on June 30, 1916, $3,000,000 capital, $2,114,000, 
of surplus and undivided profits, and $50,845,000 
of total resources. 

We come now to the story of New England's 
foremost trust company development. This 
bears the name of the Old Colony Trust Com- 
pany of Boston. On the 14th of June, 1890, 
it began a business destined to become the 
largest of its kind in New England. The story 
of that first day's transactions as carried on in 
a small back office at No. 50 State Street was 
graphically told in a sketch published by the 
Company twenty-five years later. This is 
how it reads: 

" Business was not particularly brisk, 
and when the closing hour arrived the cus- 
tomers of the youngest banking institution 
in Boston numbered two, both of whom were 
officers of the company. The office force 
consisted of three, Messrs. T. Jefferson 
Coolidge, Jr., Charles S. Tuckerman, and 
George E. Stickney, assisted by an office boy, 
name unknown, who vanished before the 



190 Story of Trust Companies 

day ended. Mr. Tuckerman was the first de- 
positor, opening an account for himself and 
another as trustee. The third and final de- 
posit for the day was made by Mr. Coolidge. 
Thus it was sort of a family affair — that 
first day's business — and it offered no sug- 
gestion of the surprising change which the 
ledgers were to reveal after twenty-five years : 
open accounts, 32,625; customers resident 
in forty-three out of forty-eight States, in 
Hawaii, Porto Rico, and the Philippines, 
and also in Canada, Mexico, the West Indies, 
Central America, South America, England, 
France, Switzerland, Italy, Germany, Syria, 
China, Japan, and Australia ; resources more 
than one hundred millions of dollars; fifth 
largest trust company in America.' ' 

In 1892 the Company removed to the Ames 
Building at the corner of Washington and 
Court Streets. Until that time accounts were 
added slowly; in fact, a year later, the record 
of customers' accounts was being kept in a book 
of two hundred pages having spaces for only 
2400 names. In 1902 the Temple Place branch 
was opened, and in 1909 the site at No. 17 
Court Street was purchased, and the Company's 



The "Old Colony" 191 

present home erected thereon, being first 
occupied in December of that year. 

The Company grew without consolidation 
until its deposits were in excess of $40,000,000 
in 1 9 10. In this latter year it was consolidated 
with the City Trust Company and its deposits 
increased to approximately $75,000,000. In 
1914 the Bay State Trust Company with about 
$6,500,000 of deposits was consolidated into 
the Old Colony Trust Company. This former 
company had long been controlled by stock 
ownership, and through this consolidation the 
Old Colony Trust Company acquired a second 
branch office on Boylston Street. 

In 1903 Gordon Abbott succeeded Mr. Cool- 
idge as President and served until 1910 when 
Philip Stockton, the present incumbent, was 
chosen at the time of the consolidation with 
the City Trust Company. In 19 13 Mr. Abbott 
became Chairman of the Board and Francis 
R. Hart, Vice-President, was made Vice- Chair- 
man. 

The story of the growth of this huge concern, 
as expressed in figures, contrasts strikingly with 
the piquant account of that "first day," and is 



192 Story of Trust Companies 

of more than passing significance. In 1896 the 
Company had total resources of $11,772,302.74 
and capital of $1,000,000. By 1906 the total 
resources were $40,019,005.63 and the capital 
stock had been increased to $1,500,000, while 
the surplus and undivided profits were over 
$5,500,000. 

During the past ten years, within which 
time most of the mergers referred to were con- 
summated, the capital stock has been further 
increased to $6,000,000. The surplus and 
undivided profits on June 30, 19 16, were 
$6,932,062.29, the deposits $126,820,621.31, and 
the total resources, as of the same date, $140,- 
235,869.34, making the Old Colony now the 
sixth largest trust company in America. 

Of trust institutions in St. Louis which have 
endured down to this time, the Mississippi 
Valley Trust Company is one of the oldest. 
It was incorporated under the laws of Missouri 
in 1890 when St. Louis was a city of 460,000 
people; to-day there are 800,000. Then only 
two bridges spanned the Mississippi River 
where now there are four, and in this space 
of twenty-six years the city's banks have 



Mississippi Valley Trust Co. 193 

doubled in number while their wealth has been 
increased sixfold. Six years after the Company- 
was established, its total resources were reported 
at a little more than $4,600,000. The precise 
total in June, 1906, was $25,647,603.53; in June, 
1916, the figure was $30,002,168.57. 

Its first President, Julius S. Walsh, is now 
Chairman of the Board of Directors, having 
been succeeded in the presidency by Breckin- 
ridge Jones, the Company's first Secretary. 
The Company is located at the northwest 
corner of Fourth and Pine streets where the 
regular appointments incidental to banking 
and trust company business are maintained, in- 
cluding a real estate, a bond, a farm loan, and 
a safe deposit department. The first office 
was in a single room on the third floor of 
the old Laclede Building. After a year the 
Company moved to No. 303 North Fourth 
Street, expecting to occupy those quarters for 
some time, but the rapid growth of the busi- 
ness soon necessitated another change and the 
fine white stone building it now occupies was 
erected. 

The capital stock, originally $1,300,000, has 
13 



194 Story of Trust Companies 

been increased at intervals and now stands at 
$3,000,000, while surplus and undivided profits 
of over half a million of dollars in 1896 are 
reported at $5,307,470.16 for 1916. 

The Company has had the administration 
of some very large trust estates. Four of these, 
amounting in each case to upwards of a million 
dollars, are in the names of the late James T. 
Drummond, tobacconist, Eugene F. Williams, 
shoe manufacturer, and Charles Clark and 
Auguste B. Ewing, capitalists. 

Among numerous enterprising features of 
management should be mentioned a bi-monthly 
periodical entitled Service addressed to "those 
who are, and those who might be, patrons of 
the Mississippi Valley Trust Company." The 
Company's steady growth has been that of a 
single institution without absorption of, or 
consolidation with, any other corporation. 



CHAPTER XIV 

1 89 1 TO I9OO. THE LARGEST TRUST COMPANY 

OF PRESENT TIMES AND SOME LATER 

ORGANIZATIONS 

We come now to the recounting of some 
achievements by a single trust company during 
the past quarter century, the scope and volume 
of which have been upon an unrivaled scale. 

This is the story of the Guaranty Trust 
Company of New York, a comparatively young 
concern, yet now the largest trust company in 
America. The institution, like some others 
in the earlier years, sprang from an older cor- 
poration with fiduciary powers of a very differ- 
ent character from those embraced in trust 
operations. This forerunner was the New York 
Guaranty & Indemnity Company, dating back 
to 1864. From then until 1891 a business 
in guarantees was transacted in line with the 

195 



196 Story of Trust Companies 

title, but in limited proportions. The accom- 
panying illustration shows the old Company's 
home in Broad Street adjoining the former 
Stock Exchange. 

About 1890 it occurred to the minds of a 
group of prominent New York financiers that 
there would be possibilities in a plan of broad- 
ening out into a regular trust business, including 
the receiving of deposits. This was per- 
missible under its charter, the Company always 
having been under the supervision of the State 
Banking Department. In 1891, the capital 
was increased from $100,000 to $2,000,000, with 
a paid-in surplus of $500,000. The institution 
then began business as a full-fledged trust 
company at No. 59 Cedar Street, in the Mutual 
Life Building. This was under the presidency 
of Edwin Packard, who was succeeded by Walter 
G. Oakman in 1894. Two years later the title 
was shortened to read Guaranty Trust Company 
of New York. John W. Castles succeeded Mr. 
Oakman in 1900, and Alexander J. Hemphill be- 
came President in 1908. The last named is now 
Chairman of the Board, Charles H. Sabin hav- 
ing succeeded to the presidency in 1913. 



Modern Organization 197 

The directorate of the Company from the 
first has been made up of names synonymous 
with great things in the financial world. Dur- 
ing the early years the Board comprised, among 
others, George F. Baker, August Belmont, 
Edward H. Harriman, Levi P. Morton, Alex- 
ander E. Orr, and Frederick W. Vanderbilt. 
In 1 9 10, the Morton Trust Company and the 
Fifth Avenue Trust Company, each of them 
old-established institutions, were merged with 
the Guaranty, and in 191 2 the Standard Trust 
Company, another representative institution, 
was absorbed. 

The growth of the Company soon necessi- 
tated increased office space on the first floor of 
the Mutual Life Building, but these quarters 
were shortly outgrown and in 1913 a new build- 
ing was erected and occupied at No. 140 Broad- 
way, corner of Liberty Street. It is one of the 
most impressive bank buildings in the world, 
containing every known appliance to facilitate 
work and to insure the comfort of customers 
and employees. In its modern vaults repose 
some billions of dollars' worth of holdings in 
trust. Pneumatic tubes give instant communi- 



198 Story of Trust Companies 

cation between different parts of the building, 
which contains over eight hundred employees. 
On the upper floors there are conference rooms 
for the use of visitors and customers, and 
these afford transient headquarters for out-of- 
town guests. There is also maintained one of 
the most comprehensive business and financial 
libraries in the country. 

The spirit of co-operation and companion- 
ship is highly developed among Guaranty Trust 
Company officers and employees, whether at 
work or at play. There are efficiency prizes, 
a debating society, and bowling and baseball 
teams belonging to the trust company leagues. 
Outings occur each summer and in winter the 
Guaranty Club holds banquets. There is a 
liberal pension system administered by an 
official board of managers appointed by the 
Board of Directors. 

The Guaranty Company's uptown office 
has been at Fifth Avenue and Forty-third 
Street in offices formerly occupied by the 
Fifth Avenue Trust Company. In the fall of 
1 9 16 it moved into new quarters directly across 
the street on the southeast corner, occupying 



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A Significant Comparison 199 

four floors of an impressive new building. An- 
other up-town office is being built at Madison 
Avenue and Sixtieth Street. There is an office 
in London and there are resident representatives 
in Paris and Buenos Aires. 

The capital was increased to $5,000,000 in 
1910, again to $10,000,000 in 1912, and on 
November 8, 191 5, was brought up to a total 
of $20,000,000. There is upwards of $20,000,000. 
of surplus and undivided profits at the present 
time, and with over half a billion of total 
resources, deposits in the neighborhood of 
$400,000,000, and a foreign department trans- 
acting an annual business of approximately 
six billions and a half of dollars, the institution 
stands to-day first among trust companies and 
is exceeded in size by only one bank, the Na- 
tional City. The growth of the Company in 
aggregate resources, during the past twenty- 
five years, is graphically shown on the oppo- 
site page. 

Some appreciation of what the Guaranty 
Trust Company's present $520,000,000 of total 
resources and liabilities signify is to be had 
when a country-wide glance is taken backwards 



200 Story of Trust Companies 

to a point twenty years ago. The Bankers 
Encyclopedia of 1896 contained a reasonably 
complete showing of trust compan}^ figures 
even though these were unofficial. A tabulation 
shows that there were then forty-one companies 
in New York State having liabilities of 387 
millions of dollars. The aggregate for Pennsyl- 
vania's eighty- two companies was 183 millions. 
These 123 companies in the two leading States, 
as regards trust company development, 
amounted at that time to but 50 millions of dol- 
lars more than the total now shown by this one 
New York company. The tabulated totals 
for 509 American companies showed capital 
152 millions, surplus and undivided profits 
96 millions, deposits 709 millions, grand total 
957 millions, a sum equal to just 184 per cent, 
of the Guaranty's 520 millions, as shown in 
1916. 

The assertion has been recently and authori- 
tatively made that the "turnover" of this 
great institution, — its aggregate of funds annu- 
ally handled, including securities and foreign 
exchange — is greater than that of any other 
banking corporation in the world. 



Panic of 1893 201 

A few words should here be said regarding 
the financial crisis of 1893. Early in that year 
a country-wide business disturbance occurred. 
There was a series of distressing railroad fail- 
ures, including the Erie, Reading, Northern 
Pacific, Union Pacific, and Atchison. In New 
York the deposits of the Clearing House banks 
fell from 431 millions of dollars to 370 millions 
in less than three months. During August a 
premium was demanded everywhere upon all 
kinds of currency. The business collapses of 
the year numbered over fifteen thousand. 
Among these were 598 financial institutions 
made up of National, State, and savings banks, 
private bankers and loan and trust companies. 
But a remarkable thing to be noted regarding 
the banking troubles of 1893 was the stability 
of the loan and trust companies. For if any 
proof were needed that by now these trust 
institutions had established themselves on a 
firm foundation, and had come to stay, it is to 
be seen in the insignificance of the number of 
suspensions, which out of 598 banking failures 
of all kinds amounted to only 14. It is a 
fact, too, that almost without exception the 



202 Story of Trust Companies 

companies to close were small concerns, as a 
rule located in unimportant fields. 

The United States Mortgage Company, 
established in 1871, first undertook a trust and 
deposit business in January, 1893. Among the 
names of the incorporators are found those of 
J. Pierpont Morgan, Abiel A. Low, Charles 
G. Landon, David Dows, and other men who 
were large factors in the financial and business 
life of the city, state, and nation. In common 
with the Guaranty Trust Company, its expan- 
sion was promoted by Mutual Life interests. 
After two years of operations under the old 
title its name was altered in 1895 to United 
States Mortgage & Trust Company. The 
" Mortgage Company," as it has been familiarly 
known, has continued to carry a large line of 
conservative real-estate loans, placed mostly 
in the larger cities of the West and South. 
Charles R. Henderson was the first Presi- 
dent, and the order of succession has been: 
George W. Young, 1894; George M. Cum- 
ming, 1905; Arthur Turnbull, 1908; Cornelius 
C. Cuyler, 1909; and John W. Platten, since 
1910. 



The "Mortgage" Company 203 

The capital prior to 1893 was $1,000,000. 
Since that time it has been $2,000,000. 

In 1903, the writer of the present volume, 
who was at that time Treasurer of the Company, 
recommended to its Board a plan of annually 
publishing a book of trust company statements. 
These figures, with other data and the names 
of the officers and directors of all American 
companies, first appeared as of June 30th 
that year. The idea has been availed of every 
summer since under the title, " Trust Com- 
panies of the United States." Each issue has 
been presented to the financial public as com- 
plimentary on the part of the "Mortgage 
Company/ ' The collected volumes form a sub- 
stantial compendium of facts and statistics, 
covering thirteen years past, the usefulness 
of which in preparing this work is gratefully 
acknowledged. 

The present strength of the Company has 
been gained through a gradual and steady 
accretion of business without mergers or con- 
solidations of any kind; while thoroughness, 
dependability, and trustworthiness have char- 
acterized the administration of its affairs. 



204 Story of Trust Companies 

Twenty years ago the Company's total 
resources were $13,000,000; ten years ago they 
were $49,000,000; in 1916, they reached the 
one hundred million mark, making it one of 
the eleven trust companies in the country 
having total resources of this amount, or 
upwards. 

The United States Mortgage & Trust 
Company's main offices have always been in 
Cedar Street, in the Mutual Life Building. 
There are two uptown branches. 

There are a number of important trust com- 
panies on the Pacific Coast to-day, and of the 
very large ones the Union Trust Company of 
San Francisco is the oldest. It was established 
in 1893 under Isaias W. Hellman, as President, 
who continued in that office until 191 6, when 
he became Chairman of the Board and was 
succeeded, as President, by his son, I. W. Hell- 
man, Jr. Three years after this organization 
was effected, the Company had $750,000 capi- 
tal, $100,000 of surplus, and a shade less than 
$3,000,000 of total resources. The capital to- 
day is $1,200,000; the surplus is $1,847,000; the 
total resources are, approximately, $30,000,000. 



Cleveland Trust Company 205 

The offices in the early years were at the 
junction of Post, Montgomery, and Market 
Streets. Since 191 1 the Company has been at 
the intersection of Market and O'Farrell 
Streets and Grant Avenue. 

The par of shares of stock is $1000 each, and 
these are now quoted at $2350 per share. 

The Cleveland Trust Company was organized 
in j 894 and began its career in a small room on 
the ninth floor of the Garfield Building with a 
capital of $500,000 and a paid-in surplus of 
$100,000 and no deposits. In the face of all 
kinds of impediments it went to work and after 
the lapse of half a year the secretary reported 
deposits of $62,000 and a trust business that 
consisted of the certifying of an issue of bonds. 

On September 10, 1895, the Company moved 
into the basement of the Garfield Building 
where it had purchased the vaults of the re- 
cently organized Security Safe Deposit & 
Trust Company, the latter going out of busi- 
ness and the Cleveland Trust Company taking 
its place and equipment. From this point 
the progress of the institution has been un- 
checked. Before the close of 1896 the deposits 



206 Story of Trust Companies 

passed the million-dollar mark. Inside of two 
years additional space was required and a 
ground-floor office was rented. 

On January 6, 1903 a consolidation was 
effected with the Western Reserve Company, 
which brought the capital of the Cleveland 
Trust Company up to $1,750,000 and the sur- 
plus to $1,050,000. J. G. W. Cowies was 
President until 1 903 . Calvary Morris succeeded 
Mr. Cowies and retained the presidency until 
1908. He was followed by Frederick H. Goff, 
who is President at this time. 

The Cleveland Trust Company has absorbed 
a number of other trust companies and banks 
in and near Cleveland during the past twenty- 
one years, many of these institutions having 
formed the basis of the present system of 
Cleveland Trust Company branches. 

The branch bank idea is only one of the num- 
ber of innovations for which the Cleveland 
Trust Company is noted. It was the first 
bank to adopt advertising as a direct influence 
for the increase of its business. It was the 
first bank to advertise nationally for savings 
deposits by mail. It was the first bank in 



Distinctive Policies 207 

Cleveland to have a separate department for 
women, and it was also the pioneer in the 
establishment of a number of distinctive policies 
for the greater safeguard of its depositors' and, 
in general, of its patrons' interests. 

Four fundamental principles, widely an- 
nounced as characterizing the Cleveland Trust 
Company, are: 

1. No loans to directors or officers; 

2. Joint control of securities and cash; 

3. Continuous daily audit; and 

4. Directors who direct, 

all of these policies having been fully consum- 
mated during Mr. Goff 's presidency. 

Starting with four employees in an up-stairs 
room, smaller than any of its present branches, 
the Cleveland Trust Company now has nearly 
four hundred employees, a monumental office 
building at the corner of Euclid Avenue and 
East Ninth Street, a five-story annex to the 
main building, and fifteen branches in addition 
to the main building. It serves a geographical 
territory of about sixty miles in length and 
twenty miles wide. It has over 122,000 ac- 
counts; the present capital and surplus is more 



208 Story of Trust Companies 

than $5,200,000, and its total resources on June 
30, 1916, were $49,071,447.24. 

In addition to its phenomenal growth and 
its unimpeachable stability as a savings bank, 
it has made great progress in its trust and 
estates departments. It has perfected a num- 
ber of unusual types of trust agreements among 
which may be mentioned the "Living Trust" 
agreement. It is also trustee for the funds and 
estates brought together under the denomina- 
tion of the Cleveland Foundation, which is a 
community trust, comprising a union of gifts 
from different estates or parts of estates contri- 
buted by the people of Cleveland and managed 
for them for the benefit of the community. 
This plan, originated by Mr. Goff , is now nearly 
two years old and has been copied in no less 
than thirteen other American cities. 

Mention is next to be made of a great south- 
ern institution, organized as a trust company 
in New Orleans in 1895. This was the year 
in which the Canal Bank & Trust Company 
acquired the assets of the old Canal Bank. 
Nine years later the Louisiana National Bank 
was also absorbed. 



Canal Bank & Trust Company 209 

The story of the Can?1 Bank dates back to 
1 83 1, when, as the first of a series of what were 
then known as improvement banks, it secured 
a charter for the purpose of financing the con- 
struction of a navigation canal connecting the 
then American port of the City of New Orleans, 
Faubourg St. Mary, with Lake Pontchartrain. 
Under this charter extensive banking privileges 
were allowed, and during the vicissitudes of 
over eighty-five years, the Bank has always 
served the community, remaining open during 
the three wars and numerous panics that have 
intervened, and is to-day occupying its own 
ten- story building located within a hundred- 
yard radius of the sites of the four banking 
houses which it has erected and outgrown during 
the three generations of its existence. 

Accordingly this modern trust company 
makes the proud claim of being the oldest insti- 
tution amongst more than ten thousand bank- 
ing corporations in the Mississippi Valley. 
In 1904 R. M. Walmsley, who had been Presi- 
dent of the Louisiana National Bank, assumed 
the same title in the trust company. The com- 
bined assets of the two institutions were then 
14 



210 Story of Trust Companies 

a matter of about $11,000,000. In 1916, with 
capital of $2,000,000 and surplus and undivided 
profits of $636,000, the total resources and 
liabilities have grown to an aggregate of 
$19,400,000. W. R. Irby acts as President 
at this time, and W. P. Burke is Chairman 
of the Board of Directors. The Company's 
building is attractively located at Camp and 
Gravier Streets. 

One St. Louis trust company, the Mercan- 
tile, had its beginning in a real-estate office on 
the first floor of the Columbia Building in that 
city. This was in 1899 and one clerk acted as 
Paying, Receiving, Discount, and Note Teller, 
answering the telephone and helping with the 
correspondence. On that day, seventeen years 
ago, Festus J. Wade, then and now the Presi- 
dent, witnessed deposits with the Company 
of about $17,000. In the meantime he has 
seen the Company expand to an institution 
with over $40,000,000 total resources. The 
Mercantile now has a capital of $3,000,000 
and $6,800,000 of surplus and undivided profits. 
The Company has eleven departments including 
a department with safe-deposit vault ca- 



The Mercantile of St. Louis 211 

pacity of seventeen thousand boxes. The Cor- 
poration Department, although comparatively 
recently organized, has charge of over fifty 
corporations, many representing very large 
St. Louis interests in the field of incorporated 
estates, realty and similar operations, and 
which leave to the Trust Company the entire 
management of their affairs. 

The Real Estate Department, instituted some 
years ago, when the Anderson Wade Realty 
Company was absorbed, is responsible as agent 
for the erection and financing of many promi- 
nent buildings in St. Louis, including the Jeffer- 
son Hotel, the Planters' Hotel, the Hargardine 
McKittrick, the Grand Leader, Union Electric 
Light Buildings, Jefferson Theatre, and other 
business structures. The Mercantile also has 
a Foreign Exchange Department which had its 
inception at the time of the World's Fair at 
St. Louis, and it issues its own travelers' 
checks. 

In 1904 the Mercantile Trust Company 
acquired the goodwill and assets of the Ameri- 
can Central Trust Company. In the same year 
an alarming run occurred in St. Louis and, 



212 Story of Trust Companies 

with disconcerted customers clamoring at the 
doors, a quick remedy had to be provided. 
The directors met and created a joint pledge 
of their personal fortunes, estimated as worth 
about fifty millions of dollars. Very naturally 
the run subsided as quickly as it had begun. 

The Mercantile Trust Company is a member 
of the Federal Reserve Bank and is the only 
trust company in the eighth federal reserve 
district having membership in this system. 
The Mercantile was the first trust company 
in St. Louis to join the St. Louis Clearing House 
Association, and was for a number of years the 
only trust company member. The institution 
is under the supervision of four governing bodies, 
the only institution in St. Louis so supervised. 
These are the Federal Reserve Bank, the State 
Bank Department of Missouri, the State Bank 
Department of Illinois, and the St. Louis 
Clearing House. 

The Company has had many large trusts, a 
comparatively recent one being that under the 
will of James Campbell of St. Louis, This 
estate of nearly twenty millions of dollars is 
being administered by the Company for the 



Commercial of New Jersey 213 

benefit of the wife and daughter during their 
lifetime, after which the entire trust estate 
goes to the St. Louis University. 

The Mercantile National Bank is affiliated 
with the Mercantile Trust Company, both 
being under the same management. The capi- 
tal of the Mercantile National Bank is $1,500,- 
000, the surplus and undivided profits over 
half a million dollars, and total resources over 
nine million dollars. 

The Mercantile Trust Company has occupied 
the very attractive building at Eighth and 
Locust Streets, adjoining the Mercantile Na- 
tional Bank building, for a period of over 
fourteen years. An addition will shortly be 
built, and will occupy the half block north of 
the present building. 

A final word is to be said regarding nine- 
teenth century incorporations, on behalf of the 
Commercial Trust Company of New Jersey, es- 
tablished in 1900. It is located at No. 15 Ex- 
change Place, Jersey City and has been under 
the management of John W. Hardenbergh since 
its beginning. Having absorbed the Third 
National Bank of Jersey City in 191 5, this 



214 Story of Trust Companies 

institution has a number of prominent New 
York names represented on its directorate, and 
the trustworthy nature of its operations is well 
illustrated by the following figures showing 
growth: 



Capital 
Surplus 
Total Resources 



1903 



$1,000,000.00 

1,851,256.27 

11,025,312.84 



1906 



$1,000,000.00 

2,197,460.27 

12,523,886.78 



1916 



$1,000,000.00 

2,5i7,249-54 
25,082,369.83 



CHAPTER XV 

NEW COMPANIES IN THE TWENTIETH CENTURY 

The early years of the twentieth century were 
marked by ever increasing numbers of new 
organizations in the trust company field. For 
example, during 1903 there were 373 new com- 
panies established throughout the country. 
Of these nearly one hundred were in Pennsyl- 
vania; more than twenty were in Pittsburgh; 
New York City had an increase of fifteen, 
not including six in Brooklyn; the single State 
of Texas reported eighteen new companies. 

During the next few years, until 1907, there 
was continued activity in forming new com- 
panies. In a chart prepared by Clay Herrick, 
of Cleveland, being one of his many excellent 
contributions to the literature of the companies, 
it has been shown that during that year no less 
than 150 new companies came into being. 

215 



216 Story of Trust Companies 

In March, 1904, a distinct departure was 
announced in the field of trust company litera- 
ture. In that month appeared the first number 
of a monthly magazine of which the New York 
Press remarked under date of March 15th: 

" Trust Companies is a new monthly publi- 
cation which enters a hitherto unoccupied 
territory in the field of journalistic enterprise. 
There are half a hundred periodicals devoted 
to news of the banks, but by some accident 
the news of the trust companies has been 
neglected. . . . Trust Companies should en- 
joy great success. In fact, the first number 
shows that its success has begun." 

The editor and publisher of this enterprising 
periodical was Christian A. Luhnow, who had 
been previously associated with the editorial 
force of the New York Commercial. His 
magazine was well received from the first, and 
continues to-day to be an authority both as to 
news and the best thought regarding institu- 
tional practice and progress. 

Returning now to the individual narratives 
of companies formed since 1900, a new develop- 
ment of 1902 is to be recorded. The Equitable 



Equitable Trust Company 217 

Trust Company of New York had been estab- 
lished in 1 87 1 by a special act of the Legislature, 
under the name of the Traders' Deposit 
Company. This was changed in 1895 to the 
American Deposit & Loan Company. The 
principal business of the Company from that 
time until 1902 was that of making loans on life- 
insurance policies. The Company's affairs were 
managed largely by interests identified with 
the Equitable Life Assurance Society, the 
owner of a controlling stock interest. In 1902 
the name was changed to the Equitable Trust 
Company of New York, and its field of activity 
was extended to include all banking and trust 
functions. The Bowling Green Trust Com- 
pany was absorbed in 1909 and the Trust 
Company of America in 1912, the latter having 
itself previously taken over the Colonial Trust 
Company, the North American Trust Company, 
and the City Trust Company. 

As a result of the insurance investigations 
in 1905, and the legislation which soon followed, 
it became necessary for the Equitable Life 
Assurance Society to dispose of its stock invest- 
ments. At that time President Alvin W. 



218 Story of Trust Companies 

Krech bought the entire Equitable Life holdings 
and distributed them to a number of influential 
interests. By this distribution the Equitable 
Trust Company of New York was made an 
entirely independent company — that is to say, 
not controlled by any single interest, or number 
of interests, to be identified or classed as 
particular financial groups. 

Under President Krech, the Equitable has 
grown to remarkable proportions. Its capital 
is $3,000,000; its present surplus and undivided 
profits are over $10,000,000. The Company's 
balance sheet of ten years ago footed about 
$55,000,000, as compared with an aggregate 
of over $170,000,000 on June 30, 191 6, thus 
making the Company fifth in size in New York 
City as well as the United States. The increase 
of the business of the Trust Department has 
kept pace with the deposits, and the Company 
now holds securities for account of others, or 
under its trusts, aggregating more than 
$1,250,000,000 of face value. Its Foreign 
Exchange Department has grown with remark- 
able rapidity and ranks third in the city for 
annual turnover during 191 5. 



Empire Trust Company 219 

Prior to 1 912 the offices of the Company were 
at No. 15 Nassau Street, from which location 
it was driven by the Equitable Building fire in 
January of that year. The Company's business 
was not even halted by this serious conflagra- 
tion. Through the good offices of its depository 
banks, the tellers of the Equitable Trust met 
that day's checks on schedule time and the 
Company was established and doing business 
in temporary quarters at No. 115 Broadway 
before noon. It now occupies its own building 
at No. 37 Wall Street and the banking floor in 
the connecting building at No. 43 Exchange 
Place. Its New York branches are located at 
No. 618 Fifth Avenue and No. 222 Broadway, 
the latter having been the home of the former 
Colonial Trust Company. Branches are. also 
maintained in London and Paris. 

The Empire State Trust Company, later 
known as the Empire Trust Company, was 
established in 1902. The first office of the 
Company was at No. 88 Wall Street. After 
1904 its location was changed to No. 42 Broad- 
way where it continued until 191 5 when the 
Company occupied a beautiful suite of offices 



220 Story of Trust Companies 

in the new Equitable Building, No. 120 Broad- 
way. 

In 1 9 13 two smaller trust companies were 
acquired, namely the Windsor and Guardian. 

The President is LeRoy W. Baldwin under 
whose management the Company has grown 
from seven millions of dollars of total resources 
in 1906 to an aggregate in 191 6 of $44,160,94742. 
The original capital was $500,000, subsequently 
increased to $1,500,000. 

The Central Trust Company of Illinois is a 
splendid illustration of modern banking growth 
in the great city of Chicago. Formed in 1902 
with four millions of dollars of capital and one 
million of surplus, it reported one year later 
$200,000 of undivided profits and nearly 
$6,500,000 of deposits. By 1916 the capital 
was $4,500,000, the surplus and undivided 
profits $1,750,000, and the total of these and 
other liabilities $56,558,000. 

The President of the Company from the 
beginning has been Charles G. Dawes, formerly 
Comptroller of the Currency at Washington. 

The offices since 1910 have been at No. 125 
West Monroe Street. One year after this date 



" First Trust and Savings" 221 

the Company absorbed the Metropolitan Trust 
& Savings Bank. This was an institution in 
the five-million-dollar class at the time of its 
acquirement. 

An important company was established in 
Chicago in December, 1903, under the title of 
the First Trust & Savings Bank, the stock being 
owned by the stockholders of the First National 
Bank of Chicago. James B. Forgan acted as 
President of both institutions until 191 5, when 
Emile K. Boisot assumed that title, upon Mr. 
Forgan's election as Chairman of the Board. 

The First Trust & Savings Bank began 
business originally at No. in West Monroe 
Street, on the first floor of the First National 
Bank building, and now occupies the entire 
ground floor of that building. The original capi- 
tal was $1 ,000,000 which has since been increased 
to $5,000,000. The present surplus and undi- 
vided profits amount to $5,400,000. 

The great growth of the institution, since its 
first statement appeared in 1904, is to be seen 
by a comparison of the figures in that year with 
those of 1906 and 1916. As of June 30th, in 
each of the three years the total figures were 



222 Story of Trust Companies 

$11,186,982.73, $30,854,781.21 and $84,730,- 
256.98 respectively. This growth has occurred 
without the absorption of any other institution. 
The Bankers Trust Company opened its 
doors for business on March 31, 1903, at No. 
143 Liberty Street, New York. Press notices 
of that date stated: 

"Since the news was first given out after 
the formation of this new financial institu- 
tion, its plans have developed rapidly, and 
its success, judging from comments in banking 
circles, is already beyond dispute." 

The reporter who wrote those lines was a good 
prophet; the Company's history has justified 
the prophecy. Beginning with a capital of 
$1,000,000, which was twenty times over- 
subscribed, and a surplus of over $500,000, 
the Company has had a vigorous and consistent 
growth, and on June 30, 191 6, thirteen years 
after its organization, its statement showed 
capital $10,000,000, surplus and undivided 
profits $15,498,791.32, and total resources 
$292,078,527.26. 

The Company grew out of the idea held by 



The "Bankers" 223 

a number of prominent bankers who were 
accustomed to dealing with one another, that 
there was room for a trust company which 
could take care of business which came within 
the knowledge of those bankers in the regular 
course of business, but which they could not 
accept at their own institutions because of the 
limitations of their charters. That the insti- 
tution would be substantial from the outset 
was to be seen from the list of original direc- 
tors whose names and corporate connections are 
here appended : 

Stephen Baker, President, Bank of the Man- 
hattan Co., N. Y.; Samuel G. Bayne, President, 
Seaboard National Bank, N. Y.; James G. 
Cannon, Vice-President, Fourth National Bank, 
N. Y. ; Edmund C. Converse, President, Liberty 
National Bank, N. Y.; Henry P. Davison, 
Vice-President, First National Bank of New 
York; James H. Eckels, President, Commercial 
National Bank, Chicago; Granville W. Garth, 
President, Mechanics' National Bank, N. Y.; 
A. Barton Hepburn, Vice-President, Chase 
National Bank, N. Y. ; William Logan, Cashier, 
Hanover National Bank, N. Y.; Edgar L. 



224 Story of Trust Companies 

Marston, Blair & Co., Bankers, N. Y. ; Gates W. 
McGarrah, President, Leather Manufacturers 
National Bank, N. Y.; William H. Porter, 
Vice-President, Chemical National Bank, 
N. Y.; George W. Perkins, J. P. Morgan & Co., 
Bankers, N. Y. ; Daniel G. Reid, Vice-President, 
Liberty National Bank, N. Y.; Edward F. 
Swinney, President, First National Bank, Kan- 
sas City; Francis H. Skelding, Cashier, First 
National Bank, Pittsburgh ; John F. Thompson, 
Vice-President, Bankers Trust Co.; Albert H. 
Wiggin, Vice-President, National Park Bank, 
N. Y. ; Samuel Woolverton, President, Gallatin 
National Bank, N. Y. ; Robert Winsor, Kidder, 
Peabody & Co., Boston; and Edward F. C. 
Young, President, First National Bank, Jersey 
City, N. J. 

The rise in total resources between the dates 
June 30, 1903, and September 7, 1905, was, in 
the order of progression : 



June 30, 1903 $ 5,748,174.87 

December 31, 1903 10,085,557.31 

June 30, 1904 15,304,064.48 

December 31, 1904 18,497,504.50 

June 7, 1905 24,899,785.18 

September 7, 1905 25,436,229.50 



A Rapid Growth 225 

The rapidity of this growth may be attributed 
in large part to the influence of the unusually 
strong directorate ; its members have been able 
to send the Company a great deal of business 
in the way of by-products of their own institu- 
tions, and undertakings; at the same time their 
presence on the board has inspired public con- 
fidence to such an extent as to attract a very 
large volume of other business. 

E. C. Converse was President until 1 913; 
he was succeeded by Benj. Strong, Jr., who 
held the office until he became Governor of the 
Federal Reserve Bank of New York. Since 
1 91 5, the Company's executive policy has been 
under the direction of Mr. Seward Prosser. 

Outgrowing the small quarters in Liberty 
Street, the new Company moved to larger 
quarters at No. 7 Wall Street, but it soon 
became apparent that the Company ought to 
have a building of its own, and President 
Strong conceived the idea of erecting a monu- 
mental building at the vortex of America's 
financial life, namely, where Wall, Broad, and 
Nassau Streets meet. 

The manner in which this building was 
is 



226 Story of Trust Companies 

planned was characteristic of the Company. 
Every detail was worked out in advance. The 
immense task of razing a twenty story steel 
and granite building to make room for the new 
home of the trust company, the excavating, 
the steel construction, and the final completion 
of the building to the last detail, were carried 
out with . remarkable precision. On May 18, 
and 19, 1912, the Company moved to its new and 
permanent home. The building and the banking 
quarters therein are hardly surpassed by any. 

Two other important New York trust com- 
panies were acquired during recent years by 
the Bankers ; one, the Mercantile, taken over in 
191 1 ; the other, the Manhattan, acquired in 
the spring of 1912. The first of these had been 
a trust company landmark in Broadway since 
1873, having been in early years under the 
Presidency of Louis Fitzgerald, and later of 
William C. Poillon; while the other dates back 
to 1 871 and was for many years under the able 
administration of John I. Waterbury. 

The announced policy of the Company at 
the outset was to conduct a trust company for 
trust company business, and to make no attempt 



Policies and Methods 22^ 

to compete with National and State banks. 
It was also decided from the beginning, to 
adopt the Clearing House rules of collection, 
and to maintain the cash reserve required of 
member banks. As soon as trust companies 
became eligible for membership in the New 
York Clearing House Association, the Bankers 
Trust Company became a member. 

When the American Bankers Association 
decided to establish its own system of travelers' 
checks, the Bankers Trust Company was 
appointed agent for all the banks issuing those 
checks, for the reason that this company was 
not competing with National and State banks, 
also because it was particularly well fitted to 
undertake the work on account of its strong 
international banking connections. The first 
"A. B. A." cheque was issued in April, 1909; 
now the cheques are one of the leading forms of 
travelers' credit, and are universally accepted 
as an international medium of exchange. 

The clientele of the Bankers Trust Company 
includes many industrial, railroad, and public 
service corporations; many foreign, state, and 
municipal governments; numerous banks, bank- 



228 Story of Trust Companies 

ers, and trust companies ; and a large number of 
state institutions, societies, associations, and 
individuals. 

A long period elapsed after the great fire 
in Chicago in 1871, before bank vaults were 
again put to the test of withstanding a violent 
conflagration. It was Baltimore's turn, how- 
ever, to suffer in 1904, and some of the facts of 
that great fire, briefed from the story, as told 
in Trust Companies, are subjoined. 

As soon as the ravages of the fire could be 
measured, came an anxious inquiry for the safety 
of the contents of bank and trust company 
vaults. As to the latter, one of several an- 
nouncements was that although eight of the 
City's twelve institutions were located in the de- 
vastated section their safe deposit and other 
vaults had remained intact. The imposing 
building of the Continental Trust Company 
proved to be practically fire proof, while that 
of the Safe Deposit & Trust Company stood 
almost unharmed amidst the charred ruins of 
its neighbors. 

There were some losses due to the premature 
opening of strong boxes which had not yet 



The San Francisco Catastrophe 229 

sufficiently cooled, but generally the losses of 
the companies were well covered by insurance. 
The firmness of the financial credit of Baltimore 
institutions was shown by a decrease of only 
about two points in quotations for their stocks 
on the first day the Exchange resumed business. 
The trust companies of the city not only came 
forward with financial aid to the public, but 
gave free rental to various banking houses. 
One company, even before the fire had run its 
course, opened its doors and provided its 
patrons with emergency sums of money until 
regular business could be resumed. 

Two years later San Francisco's financial 
interests had to be tried out under even sterner 
conditions and in that city a valuable object 
lesson, previously learned, was availed of, for 
whereas in Chicago and in Baltimore many 
millions of dollars' worth of securities and valu- 
ables had been destroyed because the heated 
vaults were opened too soon, thus admitting 
oxygen, the same mistake was not made by the 
San Francisco bankers. When the contents 
of the vaults there were exposed to the air, 
several weeks after the fire, the contents were 



230 Story of Trust Companies 

found safe and intact. Because of these wise 
precautions, the financial resources of San 
Francisco suffered little material hurt and 
banking was resumed without any serious losses. 
The formation of committees of bankers for 
the purpose. of safeguarding moneyed interests 
and preventing runs was likewise a means of 
restoring confidence. Withdrawals of deposits 
were limited, and payments made by certificate 
checks drawn by banks on the United States 
Mint, where a Clearing House Bank was formed 
for temporary needs. 

All of the banks and trust companies opened 
temporary offices immediately, and most of 
them made prompt arrangements for the re- 
construction of headquarters in the burned 
district. The massive vaults of the California 
Safe Deposit & Trust Company, although 
buried under tons of debris, were found intact 
with their contents in good condition, and the 
same was true of the vaults and safes of the 
Mercantile Trust Company. Practically all 
of the city's financial institutions were equipped 
with modern vaults, and they successfully 
survived the test of both fire and earthquake. 



CHAPTER XVI 

THE PANIC OF I907 

In the fall of the year following the San 
Francisco fire, with almost as little warning, 
and with a sudden violence, unheard of in the 
history of previous financial disturbances, a great 
panic broke upon New York and soon spread 
steadily to all parts of the country. In ear- 
lier pages several instances have been shown 
of how the trust companies played some indivi- 
dual parts during the depressions of the past 
century, but the panic of 1907 was in its very 
origin a tragedy of trust company difficulties. 

The first shock to financial circles came on 
October 21st, when the National Bank of 
Commerce announced that it would no longer 
clear the checks of the Knickerbocker Trust 
Company. This Company closed its doors at 
noon on the following day, after paying out 
231 



232 Story of Trust Companies 

$8,000,000 in cash to its depositors. Strin- 
gency at once became apparent in the money 
market, and at the usual opening at the money 
post of the Exchange on October 226. not a 
loan could be negotiated for almost an hour, 
a circumstance unprecedented in the history 
of Wall Street. October 23d saw frenzied 
runs on the Trust Company of America and the 
Lincoln Trust Company, the former during the 
day meeting withdrawals of §13,000,000, to be 
followed next day by $9,000,000 more. Some 
hope was inspired by a midnight meeting of 
bankers and brokers, with J. Pierpont Morgan 
at their head, who promised to help the trust 
companies, and by the assurance of assistance 
from the Government. 

Nevertheless conditions on the Exchange 
during the day of October 24th were in an 
unmistakable state of panic when, at 2:15 p.m., 
a pool of the principal banks, acting through 
J. P. Morgan & Company, came to the assist- 
ance of the money market, loaning $25,000,000, 
with such prompt and beneficial results that 
stocks began immediately to recover and some 
measure of confidence was restored. On this 



Remedial Measures 233 

day also the National banks received $19,000,000 
from the Government. However, on the next 
day, October 25th, occurred fresh evidences of 
the deep seated nature of the trouble in the 
failure of three banks and three trust companies, 
the First National of Brooklyn being the first 
Clearing House member to suspend. Then 
followed the issuance of Clearing House certi- 
ficates, which course had not been resorted to 
since 1893. 

With the engagement, on October 23d, of 
$18,750,000 gold for import the situation was 
greatly relieved; stocks advanced, but runs 
on the banks continued, and the Clearing 
Houses of Boston, Chicago, and many other 
cities began to issue certificates. Early in 
November the first importation of gold arrived, 
and at the same time announcement was made 
that, upon examination, the assets of the be- 
sieged New York trust companies were found 
to be more than sufficient to cover all deposits. 
The hopeful impression thus created was, how- 
ever, largely offset on November 16th when, 
at the request of the State Superintendent of 
Banks, temporary receivers were appointed for 



234 Story of Trust Companies 

the Williamsburg Trust Company, Jenkins 
Trust Company, International Trust Company, 
Borough Bank of Brooklyn, and Brooklyn Bank. 
A relief plan announced by the Government 
on November 17th provided for the issuance 
of $100,000,000 three per cent, one-year notes, 
and $50,000,000 two per cent, bonds, the 
former with the view of attracting the hoarded 
money of small investors, and the latter as the 
basis of new bank note circulation. Conditions 
during the last week of November, and, indeed, 
until the end of 1907, when gold imports had 
reached $100,000,000, showed a decided improv- 
ment, judged by the behavior of stocks; and a 
reassuring bank statement was issued on De- 
cember 28th, showing that the deficit in surplus 
reserves was $20,170,350, a reduction of 
$11,580,650, from the figure for the previous 
week, and of $33,933,250 from that for the 
week ending November 23d, the worst during 
the panic. At the same time, while the recov- 
ery of the stock market was rapid, the gains 
in general represented less than one fourth of 
the recessions in price which had occurred 
during the preceding twelve months. The 



Committee of Company Heads 235 

Comptroller of the Currency at the close of the 
year made the following statement : 

"From October 20th to December 30th, 
there have been but sixteen suspensions or 
failures of national banks. Of these, two 
have resumed and several more should do 
so in the near future. Contrast this with the 
panic of 1893, when one hundred and sixty 
national banks failed, and of these, fifty-four 
were never re-opened." 

Meanwhile trust company suspensions In 
1907, outside of New York, were few and unim- 
portant, although the Union Trust Company of 
Providence closed its doors during the severest 
strain of the panic, and was not re-opened for 
business until May, 1908. 

All during the period of severest depression 
committees of bankers labored in the larger 
cities, in and out of season, toward establishing a 
clear understanding of internal conditions in in- 
stances of ill-managed or temporarily weakened 
banks and trust companies. 

In New York the Trust Company Committee 
consisted of such able financiers as: 

Edward King, of the Union, who acted as 



236 Story of Trust Companies 

Chairman; John W. Castles, of the Guaranty; 
John I. Waterbury, of the Manhattan; Edwin 
S. Marston, of the Farmers' ; James N. Wallace, 
of the Central; and Edward W. Sheldon, of 
the United States Trust Company. 

These heads of great institutions, confronted 
by problems which promised only " to perplex 
and dash maturest counsels," labored ceaselessly 
in efforts to bring order out of the chaotic 
conditions involving their neighbors, the 
weaker trust companies. There were all-night 
meetings of the Committee, Mr. Morgan at- 
tending these and laboring tirelessly to adjust 
the difficulties. These meetings were followed 
by prolonged daily conferences with the manage- 
ment of the New York Clearing House; the 
securities and loans of some of the embarrassed 
companies were taken under physical control, 
and were listed, studied, and reported upon 
with recommendations that the more deserving 
concerns be given financial aid. Never in the 
history of New York banking affairs has there 
been a crisis requiring efforts so earnest and so 
ably directed toward co-operation; never has 
there been a group of men, made up of the 



" Knickerbocker" and "Columbia" 237 

heads of competitive corporations, who so un- 
tiringly set themselves to the task of solving 
a series of vast problems in tangled finance. 
The aid thus furnished was a powerful influence 
in bringing about a speedy restoration of public 
confidence everywhere, and it is safe to assert 
that for generations to come the efforts and 
accomplishments of the New York Trust 
Company Committee of 1907 will be gratefully 
remembered by the entire banking and business 
community. 

A few failures occurred during 1908, but a 
general readjustment ensued everywhere in 
financial and commercial lines. Although the 
effect on industries had been almost complete 
paralysis for a time, specie payments were not 
suspended by the banks as in 1857, 1873, and 
1893, and with more despatch than might have 
been anticipated, considering former panic exper- 
iences, the causes of the trouble were removed, 
the over extended institutions were in some cases 
liquidated, in others re-organized, and the 
country shortly settled down to more conserva- 
tive plans of making loans and investments. 

The Knickerbocker Trust Company's seventy 



238 Story of Trust Companies 

odd millions of dollars of deposits suffered a 
great curtailment, but the distress of the depo- 
sitors was mitigated in some measure by the 
wise and energetic efforts of a committee, 
headed by Mr. Morgan's son-in-law, Herbert 
L. Satterlee. The Company re-opened some 
weeks after its enforced closing and, within a 
few months, paid every depositor in full with 
interest. In 19 12 it amalgamated with another 
company, now to be described. 

The Columbia Trust Company holds a 
charter dating back to the seventies, although 
the trust company privileges it conferred were 
not availed of until the year 1905. Robert 
S. Bradley acted as the first President, being 
succeeded in 1908 by Willard V. King. The 
offices have been successively at No. 20 Nassau 
Street, No. 135 Broadway and, since 191 2, at 
No. 60 Broadway. 

In 1 9 12 the interests of the Columbia Trust 
Company and the Knickerbocker Trust Com- 
pany were united, and Charles H. Keep became 
Chairman of the Board, having been President 
of the newer and stronger Knickerbocker Trust 
Company. 



Astor Trust Company 239 

The Columbia Trust Company is to-day one 
of the companies in the one hundred million 
dollar class, the aggregate of its statement 
having reached this figure in the spring of 19 16. 
Ten years ago its capital was $1,000,000, its 
surplus and undivided profits a shade over the 
same amount, its total resources $7,000,000. 
In 191 2 it had accumulated another million 
of surplus and undivided profits, and had depo- 
sits of about $20,000,000. In 191 6 it reported 
two millions of capital, eight millions of surplus 
and undivided profits, and nearly one hundred 
and five millions of dollars of total assets and 
liabilities. It is paying dividends, including 
extras, of twenty-eight per cent, per annum. 
It maintains a branch office at Fifth Avenue, 
corner of Thirty-fourth Street, one in Harlem 
at the corner of Lenox Avenue and 125th 
Street, and in the Borough of the Bronx at 
Third Avenue and 148th Street. 

Among large New York trust institutions 
the youngest is an uptown company incor- 
porated in 1907. This is the Astor Trust Com- 
pany at No. 389 Fifth Avenue, corner of Thirty- 
sixth Street; an imposing building, now being 



240 Story of Trust Companies 

erected at the southeast corner of Fifth Avenue 
and Forty-second Street — one of the busiest 
sections of the city — will in the future be its 
home. E. C. Converse has been President from 
the beginning. 

Its personnel is of the highest character and 
the growth of accounts has been phenomenal 
from the start. During the first year of busi- 
ness the resources were shown in the surprising 
aggregate of $11,000,000; by 191 6 they had 
amounted to $35,000,000. The present capital 
is $1,250,000, the surplus and undivided profits 
over $1,700,000. 

The trust company idea, while essentially 
a development within the United States, has 
been made the model for several incorporations 
abroad. In Canada there are about twenty 
companies at the present writing, ranging from 
Halifax to Vancouver. Few of these, however, 
receive deposits except in trust. A number have 
extensive branch office connections. Among the 
leading companies of the Dominion, may be 
mentioned the Toronto General Trusts Corpora- 
tion, dating back to 1882, and The Royal Trust 
Company of Montreal, incorporated in 1899. 



Foreign Companies 241 

Hawaii is the home of seven institutions, 
and The Trust Company of Cuba has been 
operated in Havana since 1905. Three years 
ago, in 1 91 3, an organization was effected in 
the City of Panama under the title Continental 
Banking Trust Company, with branches in 
Bocas del Toro and David, Panama. London, 
England has its British Reserve Trust Company, 
and the Australian field is served by the Trustee, 
Executors and Agency Company of Melbourne. 
A financial writer some years ago presented the 
claim that the Industrial Bank of Japan, located 
in Tokio, conducts a business which in many 
respects resembles the plan of operation pursued 
by American trust companies. 
16 



CHAPTER XVII 

BRIEF SKETCHES OF TWENTY-SIX REPRESEN- 
TATIVE INSTITUTIONS 

In the foregoing chapters the thirty largest 
trust companies in the Country have been de- 
scribed, with sketches of some few institutions, 
fifteen in number, which, because of their age 
or organization in representative parts of the 
country, have served to make a continuing 
story of development. On June 30, 191 6, there 
were twenty-five other institutions which one 
year previous had issued statements, as set 
forth in the United States Mortgage & Trust 
Company's book, Trust Companies of the 
United States, amounting in each case to fifteen 
millions of dollars and upwards. These twenty- 
five companies, because of their commanding 
position in these days, must be given due men- 
tion, and it is a source of regret that the scope 
242 



Some California Companies 243 

of this brief story will not permit of reference 
to the many hundreds of other representative 
concerns which are notable as having accom- 
plished, in degree, the same honorable successes 
as have been reached by the seventy largest 
companies chosen for purposes of specific 
narratives. Grouped from West to East, 
rather than according to age or size, these 
twenty-five concerns (with the addition of one 
large Chicago institution not having the word 
"trust" included in its corporate title) will be 
found to rate from forty-one millions of present 
resources downward, and to be, in a number of 
instances, first in rank among trust companies 
within certain cities not heretofore mentioned. 
The Savings Union Bank & Trust Company 
of San Francisco, was incorporated in 1862 as 
the San Francisco Savings Union. In Septem- 
ber, 1 910, it absorbed the Savings & Loan 
Society, incorporated in 1857, and changed its 
name to Savings Union Bank of San Francisco. 
The bank offices were originally located on 
California Street, but in January, 191 1, were 
moved into a newly completed building at the 
corner of Grant Avenue, Market, and O'Farrell 



244 Story of Trust Companies 

Streets, the recognized retail shopping center. 
In December, 191 1, it enlarged its corporate 
powers to include trust business, and the title 
was changed to Savings Union Bank & Trust 
Company. The capital is $1,500,000, the 
surplus and undivided profits $2,230,000, and 
the total resources are well over $41,000,000. 
John S. Drum has been President of this insti- 
tution since March, 1910. 

The Los Angeles Trust Company was in- 
corporated in August, 1902, owning the eight 
story office building at the northwest corner 
of Second and Spring Streets, where trust and 
safe deposit departments are maintained. On 
March 1, 1903, the Company's banking depart- 
ment had its inception, and in September, 1909, 
the name of the institution was changed to 
Los Angeles Trust & Savings Bank. 

Having sold the location at Second and 
Spring Streets, in 1909, the Company moved to 
the Central Building at the southwest corner of 
Sixth and Main Streets. There it absorbed 
the business of the Metropolitan Bank & Trust 
Company, which was occupying quarters on 
the site of the present location. The building 



Los Angeles Institutions 245 

was immediately torn down, and the handsome 
structure now occupied by the Los Angeles 
Trust & Savings Bank was erected. 

At the time of the consolidation, the combined 
deposits amounted to approximately $6,000,000, 
while the latest published statement, as of 
July 1, 1916, shows deposits of $25,089,817.20. 

The Los Angeles Trust & Savings Bank 
moved to its present location on August 14, 
191 1 , the banking and trust departments occupy- 
ing the main floor, with the safe deposit de- 
partment beneath. J. C. Drake has been the 
President of the institution since 1903, and 
under his able management it has grown to be 
the second concern of its kind in size in the 
City. The present capital is $1,500,000, the 
surplus and undivided profits, $1,640,000. 

The German American Trust & Savings 
Bank of Los Angeles dates back as a savings 
institution to 1890, as a trust company to 1912, 
and is presided over by M. N. Avery. Its 
offices are located at Seventh and Spring Streets, 
and its latest balance sheet footed for nearly 
$25,000,000, including $1,000,000 of capital, 
and $1,346,000 of surplus and undivided profits. 



246 Story of Trust Companies 

The German-American has upwards of fifty 
thousand depositors' accounts on its books at 
the present time. 

The Commerce Trust Company of Kansas 
City has been since 1906 the best known institu- 
tion in that locality. It is in the fifteen-story 
Commerce Trust Building at Tenth and Wal- 
nut Streets. The first President was Dr. W. 
S. Woods, but since 1909 that office has been 
held by W. T. Kemper. The Vice-Presidents 
areW. S. McLucas, R. C. Menefee, andTownley 
Culbertson. 

The capital has always been $1,000,000, and 
there is a trifle more than this sum in surplus 
and undivided profit accounts. The resources 
on June 30, 1916 totaled $22,868,121.47. 

An interesting feature of the Company's 
operations is an "accumulative savings plan." 
Under this there are certificates issued for 
$100, $200, $500, or §1000, the depositor's pay- 
ments to be received monthly for a period of 
seven years, interest and certain additional 
credits being allowed at maturity. In the 
instance of a $500 certificate, eighty-four 
monthly payments of $5.35 each or a total 



Hibernia of New Orleans 247 

investment of $449.40, at maturity have a 
worth of $500, plus a 2 per cent, bonus. 

The Hibernia Bank & Trust Company of 
New Orleans, while not claiming to date back 
to as early a period as its neighbor, the Canal 
Bank & Trust Company, is the foremost 
institution of its kind in New Orleans. It 
occupies a beautiful home at the corner of 
Carondelet and Gravier Streets, and since 1904 
has been under the presidency of John J. 
Gannon. Prior to that time John W. Castles, 
afterwards the chief executive of the Guar- 
anty Trust Company, and later of the Union 
Trust Company of New York, acted as 
President. 

The Company has $1,500,000 of capital, 
over $2,000,000 of surplus and undivided pro- 
fits, and approximately $23,000,000 of aggregate 
assets and liabilities. 

In Chicago, the Northern Trust Company, 
at No. 50 South La Salle Street, ranks to-day 
in the forty million dollar class. It was or- 
ganized in 1889, and its balance sheet footed 
in 1896 for $10,000,000; in 1906, for almost 
$31,000,000, and in 1916 for $41,000,000. The 



248 Story of Trust Companies 

capital is §2,000,000, and the surplus and undi- 
vided profits are upwards of $2,800,000. 

The Company has had two Presidents, Byron 
L. Smith down to 1913, and Solomon A. Smith 
since that time. 

In 1907 the Chicago and other Western busi- 
ness of the investment banking house of N. 
W. Harris & Company, founded in 1882, had 
so increased as to warrant its incorporation 
as a bank and trust company, the new title 
being Harris Trust & Savings Bank. By 
191 1 its deposits exceeded $19,000,000. In 
the fall of that year the Company moved into 
new quarters known as the Harris Trust Build- 
ing, a structure combining the acme of modern 
architecture with convenience and safety. It 
is noteworthy that at the formal dedication of 
the building, the Twentieth Century Limited 
was specially chartered to carry the stockhold- 
ers and employees of the New York and Boston 
associated banking houses to Chicago, where 
a banquet was given in the main lobby of the 
bank in honor of the event. 

Albert W. Harris is President, having suc- 
ceeded Norman W. Harris, the founder and 



Harris Trust & Savings Bank 249 

first president, when be became Chairman of 
the Board; the latter died July 15, 1916. The 
19 1 6 figures of capital, surplus and undivided 
profits, and total resources are reported at 
$1,500,000, $3,500,000, and $35,000,000, respect- 
ively. Its sales of investment bonds are un- 
doubtedly the largest made by any institution 
west of New York City. 

The Chicago Title & Trust Company 
located at No. 69 West Washington Street in 
that City, in a building bearing the Company's 
name, goes back in its history to the abstract 
business conducted by Rees & Rucker in 
1847. Under various succeeding co-partner- 
ships a title business was built up until 1901, 
when a merger occurred of all the title companies 
then in existence in Cook County, Illinois. 

The President of the institution is Harrison 
B. Riley, and its capital is $5,600,000, with 
surplus and undivided profits of $3,800,000. 
The Company makes abstracts of title, guar- 
antees titles to real estate and does a general 
trust business. It has never accepted deposits. 

Among Chicago trust companies mention 
might properly be made of the Hibernian 



250 Story of Trust Companies 

Banking Association at No. 208 South LaSalle 
Street. George M. Reynolds is President, and 
the institution, while not containing the word 
"trust" in its title is amenable to the laws of 
Illinois covering trust companies, and as an 
association doing a trust business, is reported 
nowadays in the thirty million dollar class. 
It is a concern worthy of being classed among 
the large trust companies of the country. 

Third in size among Cleveland's trust insti- 
tutions at the present writing stands the Guard- 
ian Savings & Trust Company at No. 322 
Euclid Avenue. It was organized in 1894, an< 3 
has had two Presidents, John F. Whitelaw 
until 1898, and H. P. Mcintosh since that year. 

In 1904 there was an absorption of the Federal 
Trust Company. For a young institution the 
growth has been remarkable. The balance 
sheet of 1896 totaled $1,125,000; in 1906, less 
than $15,000,000, and in 1916, over $37,000,000. 
The final figure includes $2,000,000 of capital, 
and $2,276,800 of surplus and undivided profits. 

New and larger quarters are now being 
constructed at Nos. 619-637 Euclid Avenue, 
which will provide ample room for the Com- 



Central Western Concerns 251 

pany's rapidly increasing business. These new 
quarters are to be ready for occupancy about 
December I, 191 6. 

The largest institution of its kind in South- 
ern Ohio, the Union Savings Bank & Trust 
Company, of Cincinnati, was organized in 1890. 
Its Presidents in succession have been J. G. 
Schmidlapp (Chairman of the Board since 
1913) and Clifford B. Wright. The offices are 
at the well-known corner of Fourth and Walnut 
Streets. From a one-million-dollar institution 
in 1896, the resources have increased in twenty 
years to a total of approximately twenty-two 
and one half millions. Among the liabilities 
are $1,000,000 of capital and nearly $3,000,000 
of surplus and undivided profits. 

The Fidelity Title & Trust Company, Pitts- 
burgh, having its home at No. 341 Fourth Ave- 
nue, was engaged in the title and trust business 
until 1903, when it sold the title business, con- 
tinuing only in the trust. John B. Jackson 
was its President for twenty years and later 
James J. Donnell was elected President and 
since 1913 has been Chairman of the Board. 
The President at this time is Cyrus S. Gray. 



252 Story of Trust Companies 

The Company's original capital was $1,000,- 
ooo, which was doubled a little over ten years 
ago. The surplus and undivided profits are 
now $6,000,000 and the total resources are $24,- 
500,000. It has a trust business aggregating 
more than $63,000,000. It has not taken over 
any other financial companies during its exist- 
ence. 

The Colonial Trust Company of Pittsburgh, 
located at No. 317 Fourth Avenue, dates back to 
1902. Its first President was Joshua Rhoades, 
and since 1904 that office has been held by 
E. H. Jennings. 

On June 30, 19 16, the Company reported 
$2,600,000 capital, $3,300,000 surplus and 
undivided profits, and $18,000,000 of resources. 

Baltimore's foremost trust company has for 
years been the Mercantile Trust & Deposit 
Company at Calvert and German Streets. It 
was incorporated in 1884 and has had two 
Presidents, John Gill of R. down to 19 10 and 
A. H. S. Post since that time. 

The original capital of $500,000 is now 
$1,500,000, and there are surplus and undivided 
profits of $3,200,000. The total resources 



Rochester Institutions 253 

have nearly doubled since 1908 and in 191 6 
were $20,531,537.13. 

This Company has the largest capital and 
surplus of any financial institution in Maryland 
or any Southern State. 

The Commercial Trust Company of Phila- 
delphia, incorporated in 1894, was originally 
located in the Drexel Building, and after two 
years of operations there, under Thomas Froth- 
ingham as President, reported resources of some- 
thing more than $4,500,000; by 1906 the total 
was $12,000,000, and in 191 6, $27,000,000. 

Horatio G. Lloyd succeeded to the presidency 
in 1900, and since 19 10 Thomas DeWitt Cuyler 
has served in that capacity. 

The present offices are on the ground floor 
of the Arcade Building, facing the City Hall. 
The present capital is $1,000,000; the surplus 
and undivided profits, $1,175,000. 

Rochester has two great trust companies, 
the elder, the Rochester Trust & Safe Deposit 
Company, organized in 1888. From a com- 
pany of five millions of dollars in 1896, this 
concern has shown an increase during twenty 
years of nearly five times over. 



254 Story of Trust Companies 

The capital in 1916 was $500,000, the surplus 
and undivided profits, $871,000, and total 
resources, $23,610,000. 

Originally quartered at No. 25 Exchange 
Street, the institution recently removed to a 
permanent home in the fine granite building 
at the southwest corner of Main and Exchange 
Streets. 

The Presidents have been J. Moreau Smith, 
V. Moreau Smith, and the present incumbent, 
William C. Barry. Robert C. Watson is Vice- 
President and Secretary. 

The Security Trust Company of Rochester 
was incorporated in 1894 an< ^ ^ as had two 
Presidents, Edward Harris and James S. Wat- 
son. Like its neighbor, as above described, 
the Company's successive reports have shown 
marked growth. The total resources in 1896 
were less than $1,500,000; in 1906, $11,500,000, 
and in 19 16 nearly $16,500,000. The present 
capital is $300,000, surplus and undivided 
profits are $546,000, and the shares of the Com- 
pany have sold in recent years at as high a rate 
as 600 per cent. 

Syracuse, New York, claims the honor of 



Hoboken Companies 255 

having been the first city outside of the very- 
large ones to have founded in its midst one of 
our great modern trust companies. This was 
the Trust & Deposit Company of Onondaga, 
chartered in 1866. Its early Presidents were 
Dudley B. Phelps and George Barnes. After- 
ward, from 1896 to 1 9 13, this title was held by 
Francis Hendricks. Since that date the admin- 
istration has been vested in Arthur W. Loasby. 

From 1876 to 1886 a doubling occurred in 
the Company's total resources, the figures 
showing growth from one half a million of 
dollars to one and a quarter millions. By 
1896 they nearly doubled again to the sum of 
two millions. During the next ten years the 
same process occurred twice, showing a total 
of nearly ten millions of dollars. At this period 
the Company's capital stock was $100,000, 
but was subsequently increased and now stands 
at $1,000,000, with surplus and undivided 
profits and other assets of $666,000, while the 
resources have again increased almost twofold 
during the ten years since 1906 and are to-day 
the substantial sum of $18,876,506.15. 

Hoboken is the home of two great trust com- 



256 Story of Trust Companies 

panies. One of these, the Hudson Trust Com- 
pany, dates back to 1890 and is domiciled in 
West Hoboken with a branch office in Hoboken. 
S. Bayard Dod was President until 1899. 
Since that time Myles Tierney has held the 
office. 

The Company's $500,000 of capital carries 
with it surplus and undivided profits of 
$1,643,000, and its aggregate resources are 
$21,257,50145. 

The Trust Company of New Jersey began 
business in Hoboken in 1899. It has been 
constantly under the Presidency of General 
William C. Heppenheimer. Ten years ago the 
resources were less than five millions of dollars ; 
in 1916 they were reported at $21,640,065.84. 
Included in this sum were investments of capital 
amounting to $600,000, which sum carried with 
it $948,000 of surplus and undivided profits. 
During the year 19 13 the Trust Company of 
New Jersey absorbed three neighboring institu- 
tions in Jersey City. These were the People's 
Safe Deposit & Trust Company, the Bergen 
& Lafayette Trust Company, and the Carteret 
Trust Company. 



Two Brooklyn Concerns 257 

A New York institution catering largely to 
wholesale trade has carried on a trust business 
since 1902 under the title of Broadway Trust 
Company. It was orginally located at No. 
756 Broadway, but in 191 1 removed to No. 
754, directly adjoining the Wanamaker stores. 
It now has its main offices in the Woolworth 
Building at No. 233 Broadway, and another 
branch in Chambers Street at the corner of 
West Broadway. There are three Long Island 
branches, in the Flatbush section of Brooklyn, 
in Long Island City, and in Borough Park. 

The capital is $1,500,000, surplus and undi- 
vided profits $937,000, and the total resources 
are upwards of $28,000,000, as against less than 
$5,000,000 ten years ago, in 1906. 

The Borough of Brooklyn contains two 
institutions which in point of size rank well 
up with the pioneer institution already de- 
scribed, the Brooklyn Trust Company. Both 
were incorporated in 1889. The Peopled Trust 
Company is next in size after the institution 
named and is in the thirty-million-dollar class 
as regards resources, having grown over eleven 
millions in the past ten years, whereas an ag- 
17 



258 Story of Trust Companies 

gregate of less than nine millions was reported 
twenty years ago, in 1896. 

Owing to the rapid expansion of the Com- 
pany's business the offices were in 1890 moved 
from No. 201 Montague Street to larger quar- 
ters at No. 172, and in 1906 a commodious and 
distinctive building was erected in the same 
street at No. 181. The Presidents have been 
William H. Murtha from the beginning to 
1 89 1, Felix Campbell down to 1902, Edward 
Johnson to 1907, and Charles A. Boody since 
that time. An important bank absorption 
occurred in 1906 when the Wallabout Bank of 
Brooklyn was acquired. 

The Kings County Trust Company at No. 
342 Fulton Street, Brooklyn, located in the 
busiest part of that borough, is an institution 
with $500,000 capital and over $2,700,000 of 
surplus and undivided profits. The relative 
figures of total resources for 1896, 1906, and 
1916 have been $7,000,000, $14,000,000, and 
$27,000,000, respectively. Julian D. Fairchild 
has been President since 1893. 

A notable testamentary trust was that cre- 
ated under the will of the late Mayor William 



1 'American" of Boston 259 

J. Gaynor who died in 19 14, making the Kings 
County Trust Company his sole executor and 
trustee. 

In concluding the separate sketches of the 
country's seventy largest trust companies, 
Boston is found to be the home of three impor- 
tant concerns not hereinbefore described. 

The American Trust Company at No. 50 
State Street has been in business since 188 1 
and has had four Presidents, Ezra H. Baker, 
who served until 1886; S. Endicott Peabody, 
until 1903; Noah W. Jordan, until 1906; and 
Russell G. Fessenden from 1907 to the present 
time. Mr. Fessenden also holds the title of 
Chairman of the Board. 

The Company in 1896 reported less than 
$5,000,000 of resources; ten years later the 
total was nearly four times that sum. In 191 6 
the aggregate was nearly $25,000,000. The 
capital has been $1,000,000 from the beginning 
and this carries with it at the present time, 
$2,386,000 of surplus and undivided profits, 
all of which has been earned. The Company 
conducts a large trust and transfer department, 
and more than one hundred and fifty corpora- 



260 Story of Trust Companies 

tions and associations employ the Company 
either as transfer agent or registrar. 

In June, 1891, a group of Boston business 
men representing interests identified with the 
Third National Bank of that city met as a 
Board of Directors and inaugurated the busi- 
ness of the State Street Trust Company. The 
institution was opened for business on the first 
day of the following month. 

The original offices were in the basement of 
the Exchange Building directly beneath the 
present quarters of the Federal Reserve Bank. 
In 1900 the Company moved to the Union 
Building at the corner of State and Exchange 
Streets. Two years later a branch office was 
opened on Massachusetts Avenue, and in 1905 
the Company erected a handsome building at 
the corner of Massachusetts Avenue and Boyl- 
ston Street. This office is equipped with modern 
safe deposit vaults and at the present time the 
needs of about three thousand depositors are 
served. During February, 191 6, the Company 
absorbed the Paul Revere Trust Company, 
and to-day has four separate offices. 

The Company now reports $1,000,000 in 




5 

00 



& 

p< 

S 
o 
O 

+■» 

w 

I 



^ 4> 

s 8 



w 



" Commonwealth " of Boston 261 

capital stock and $1,638,000 in surplus and 
undivided profits. Its total resources on Octo- 
ber 31, 1896, were $1,524,67348. By June 30, 
1906, they amounted to $9,535,781.73. The 
growth of the Company down to June 30, 191 6, 
is evidenced by a volume of total resources 
amounting to $28,803,374.87. 

Moses Williams was the first President and 
has been Chairman of the Board since 19 13, 
Allan Forbes having succeeded to the presidency 
in 1911. 

The Commonwealth Trust Company began 
doing business in Boston at its offices, No. 88 
Summer Street, in 1904, with a capital of one 
million dollars. The Colonial National Bank 
of Boston was absorbed by this institution 
during the first year of its existence and the 
growth has been in marked degree at all times, 
it now having four separate offices doing busi- 
ness in different parts of the city. 

The assets have doubled within the past ten 
years and to-day amount to the sum of $22 , 
787,949.36. The capital has always been $1 ,000,- 
000 and there is a present surplus fund, with 
additions of undivided profits, of $729,203.12. 



262 Story of Trust Companies 

The Company has absorbed two other institu- 
tions in recent years, the New England National 
Bank in 1909, and the Hamilton Trust Com- 
pany in 1 9 14. David J. Lord was the Com- 
pany's President until 1909; since then George 
S. Mumford has served in that capacity. 



CHAPTER XVIII 

THE TRUST COMPANY SECTION OF THE AMERICAN 
BANKERS' ASSOCIATION 

Prior to the year 1896 there had been no 
distinctive organization of trust company offi- 
cials. Many of the companies had, indeed, 
been members of the American Bankers' Asso- 
ciation, some of them almost from its beginning 
in 1875, and had regularly sent representatives 
to the annual conventions of that body, the 
proceedings of which, always interesting to 
financial minds, bore at times directly on trust 
company affairs. But as the years went by, 
each furnishing evidence of the great and ever 
broadening scope of trust company interests, 
the desirability of an organization, allied with 
the Association, but having an individual entity 
and recognized aims, was increasingly felt. 

The first step toward the realization of this 
263 



264 Story of Trust Companies 

project was taken in 1895 when the Executive 
Council of the American Bankers* Association 
was requested so to amend its by-laws as to 
permit of a Trust Company Section being 
formed; the application was refused on the 
ground that no precedent for such a course 
existed. The next year, however, early in 
September, a letter was addressed to the trust 
companies calling attention to the want of 
adequate organization, and suggesting that 
representatives be sent to discuss the matter 
at the convention of the American Bankers' 
Association to be held in St. Louis on Septem- 
ber 22 d. This letter was sent out through the 
Mississippi Valley Trust Co., and had to it 
appended the following names: 

Boston— Old Colony Trust Co., by T. 
Jefferson Coolidge, Jr., President. 

New York — Continental Trust Co. of the 
City of New York, by Otto T. Bannard, 
President. United States Mortgage & 
Trust Co., by G. W. Young, President. 

Brooklyn — Franklin Trust Co., by Geo. H. 
Southard, President. 

Chicago — The Northern Trust Co. Bank, 



Founders of the "Section" 265 

by Arthur Heurtley, Secretary. Security 
Title & Trust Co., by Peter Dudley, 
Trust Officer. Title Guarantee & Trust 
Co., by Frank H. Sellers, Trust Officer. 

Indianapolis — The Union Trust Co., by John 
H. Holiday, President. 

St. Louis — Mississippi Valley Trust Co., by 
Breckinridge Jones, second Vice-President. 
St. Louis Trust Co., by John D. Tilley, 
Secretary. Union Trust Co. of St. Louis, 
by C. Tompkins, Treasurer. Lincoln 
Trust Co., by A. A. B. Woerheide, Secretary. 

Louisville — Columbia Finance & Trust Co., 
by Attila Cox, President. Fidelity Trust 
& Safety Vault Co., by John Stites, Vice- 
President. 

Denver — The International Trust Co., by 
F. B. Gibson, Secretary. 

In response, seventeen representatives of 
trust companies were present at the convention 
which was held at the Planters' Hotel, and on 
the evening of the first day a meeting was called 
with Henry M. Dechert presiding and Breck- 
inridge Jones acting as secretary. As a result 
of the deliberations and subsequent action of 
this body the by-laws of the American Bankers' 



266 Story of Trust Companies 

Association, by unanimous vote on September 
24, 1896, were amended to include, among 
others, the following clauses : 

"A section of the Association to be known 
as 'Section of Trust Companies' is hereby- 
established which shall meet annually in 
connection with the meeting of this Associa- 
tion. 

"The scope of the section shall embrace 
matters of interest to trust companies in so 
far as such matters are distinct from bank- 
ing. It may report to the Association, and 
affairs relating to trust companies may be 
referred to it." 

Such was the origin of the Trust Company 
Section which, in its growth and importance, 
has amply justified the foresight and initiative 
of its founders. The membership in 1897, 
when the first annual meeting was held, num- 
bered 114, which figure had grown to 253 in 
1900, and has been constantly increasing until 
to-day it is well over 1400-. 

The annual meeting places of the Section, 
with the names of the Chairmen (Presidents, 
since 1905), are here given: 



Presidents and Meeting Places 267 

1897. Detroit, Henry M. Dechert, Common- 

wealth Title Insurance & Trust 
• Company, Philadelphia; 

1898. Denver, Francis S. Bangs, State Trust 

Company, New York City; 

1899. Cleveland, Breckinridge Jones, Missis- 

sippi Valley Trust Company, St. 
Louis ; 

1900. Richmond, Anton G. Hodenpyl, Michi- 

gan Trust Company, Grand Rapids; 

1901. Milwaukee, Wm. G. Mather, American 

Trust Company, Cleveland; 

1902. New Orleans, John Skelton Williams, 

Richmond Trust & Safe Deposit 
Company; 

1903. San Francisco, John E. Borne, Colonial 

Trust Company, New York City; 

1904. New York, Breckinridge Jones; 

1905. Washington, D. C, E. A. Potter, Ameri- 

can Trust & Savings Bank, Chicago; 

1906. St. Louis, Clark Williams, Columbia 

Trust Company, New York City; 

1907. Atlantic City, Festus J. Wade, Mercan- 

tile Trust Company, St. Louis; 

1908. Denver, Philip S. Babcock, Trust Com- 

pany of America, New York City; 

1909. Chicago, A. A. Jackson, Girard Trust 

Company, Philadelphia; 



268 Story of Trust Companies 

19 10. Los Angeles, H. P. Mcintosh, Guardian 

Trust Company, Cleveland; 

191 1. New Orleans, Oliver C. Fuller, Wiscon- 

sin Trust & Security Company, 
Milwaukee; 

1912. Detroit, Col. F. H. Fries, Wachovia 

Loan & Trust Company, Winston- 
Salem, N. C. 

1913. Boston, William C. Poillon, Bankers 

Trust Company, New York City; 

1914. Richmond, F. H. Goff, Cleveland Trust 

Company ; 

1915. Seattle, Ralph W. Cutler, Hartford 

Trust Company; 

1 91 6. Kansas City, John H. Mason, Commer- 

cial Trust Company, Philadelphia. 

In the years 1898, 1900, 1903, and 1904, in 
the absence of the regular Chairmen, and in 
1907 of the President, the meetings were pre- 
sided over by Breckinridge Jones, William G. 
Mather, E. A. Potter, Clark Williams, and 
Philip S. Babcock, respectively. 

The order of business at the meetings, after 
the customary preliminaries, has generally 
been as follows: Address of Welcome; Reply 
to Address of Welcome; Secretary's Report; 



The " Standard Oil Trust " 269 

Report of the Executive Committee; Report 
of Committee on Protective Laws; Reports of 
Special Committees; Addresses; Addresses of 
Vice-Presidents of the Section from the various 
States; Election of Officers; Adjournment. 

In retracing the story of the Trust Company 
Section, its present magnitude and its progress 
during twenty years, consideration should be 
given to the conditions which antedated its 
inception. There were in the entire country, 
according to the report of the National Mone- 
tary Commission in 1894, on ^y 22 & institutions 
that, having regard to the functions they per- 
formed, could rightly be described as trust 
companies. But owing to the looseness, or the 
absence, of laws governing such activities there 
were many concerns which, for reasons decidedly 
under suspicion, flaunted the word "trust" in 
their titles, and found a fruitful soil for their 
operations in the general misconception of what 
a true trust company should be. Nor was such 
ignorance of the matter confined to the masses 
of the people. Breckinridge Jones, the reputed 
"father " of the Section, has amusingly recounted 
his experiences when he attempted to discover 



270 Story of Trust Companies 

and collate the laws of the various States 
referring to trust companies. He wrote for 
information to the proper authorities through- 
out the country and, in the case of several 
States, learned that there was nothing in the 
laws bearing on the subject. The state officials 
in other instances proved by their responses, 
and the material supplied, that their notion 
of a trust company might be represented fairly 
by the definition, "a combination in restraint 
of trade"; while one Attorney General, on its 
being pointed out that he had in this manner 
misunderstood the purport of the query, sought 
to rectify his mistake by stating that the only 
trust company of which his department had 
knowledge was the Standard Oil Trust! 

Among the trust companies themselves there 
had been, in general, scarcely any attempt at 
cooperation, and little uniformity of ideals and 
practice. The promoters of the Section, aware 
of the need of thorough and constructive propa- 
ganda, proceeded to "lay the foundation for a 
recognized literature, standardize the business, 
and promote acquaintance and social inter- 
course among trust company men." There 



Addresses before the Section 271 

had been, previously, almost no literature on the 
trust company; in fact it has been stated that 
all the printed information on the subject, 
scattered and inaccessible as it was, might be 
contained in the space of fifty pages. With 
the publication of the Proceedings of the Trust 
Company Section for the inaugural year 1897, 
a beginning was made on what has become an 
extensive and valuable accumulation of special 
knowledge. As meeting after meeting took 
place addresses were delivered, and in due 
course published, on the different phases of 
trust company work. Prominent trust com- 
pany officials stood forth ready to impart, for 
the benefit of the cause, the information and 
opinions which they had gained by interested 
study and long experience. In these endeavors 
they were ably seconded by the bankers them- 
selves, who, once the scope of the Section was 
defined, saw in its activities only the promise 
of a friendly rivalry, mutually beneficial, be- 
tween their institutions and the trust companies. 
Moreover, in addition to those whose efforts, 
however praiseworthy, might be ascribed to 
naturally interested motives, there were found 



272 Story of Trust Companies 

prominent men in other walks of life, Federal 
and State officers, lawyers, public accountants, 
and statisticians, who, seeing in the work of the 
Section the hope of a broader and more orderly 
system of national finance, willingly helped to 
further the movement by preparing and de- 
livering appropriate addresses before the meet- 
ings. A few of these may be mentioned as 
indicating the range of subjects presented: 
1903, address on "The Problem of Wealth and 
the Trust Company as Trustee," by Hon. 
Lyman J. Gage, ex-Secretary of the Treasury; 

1906, "Defalcations: what Can be Done to 
Decrease them," by Hon. Pierre Jay, then 
Bank Commissioner of Massachusetts, now 
Federal Reserve Agent in New York City; 

1907, "Confusion of Meaning of Trust Com- 
panies," by Hon. Charles Emory Smith, former 
Postmaster General and United States Ambas- 
sador; 1 91 2, "Some Unscheduled Liabilities of 
Trust Companies," by Dean Henry M. Bates, 
University of Michigan; 1913, "The Relation 
of the Government to the Trust Company," by 
Hon. Samuel W. McCall, Governor of Massa- 
chusetts; 1 9 14, "Future of State Institutions 



Social Side 273 

under the Federal Reserve," by H. Parker 
Willis, Secretary, Federal Reserve Board. 

Those responsible for the progress of the 
Section have not, however, depended alone on 
the educational influence of the meetings, in- 
spiring and far reaching though it has been. 
From time to time there has been published 
and circulated carefully compiled matter of 
practical value to trust company officers, such 
as the Digest of Trust Company Laws in the 
States and Territories, and Forms for Trust 
Companies. Many folders and booklets, con- 
taining brief articles on trust company services, 
have also been prepared and distributed in 
large quantities for general information. 

In assemblages of business men, however 
engrossing the occasion that has brought them 
together, the social and recreative instincts 
are usually, as a matter of course, taken into 
account. In this respect the Trust Company 
Section, so far as the annual meetings are con- 
cerned, is relieved of initiative through its 
affiliation with the American Bankers' Associa- 
tion, whose plans for social enjoyment are 
heartily availed of, and include banquets, 
18 



274 Story of Trust Companies 

receptions, balls, trips to interesting points, 
etc. Among the memorable events of this 
nature may be recalled the Grand Ball given 
at the Auditorium in Chicago in 1909, when 
President Taft and General Frederick D. Grant 
were present. Previously, in 1904, when the 
convention was held in New York, the local 
members of the Section provided special enter- 
tainment for their associates in the form of a 
luncheon, followed by a trip through the newly 
completed subway. 

Reference will later on be made to the ban- 
quet given in 191 1, on the eve of the admission 
of trust companies to full membership in the 
New York Clearing House. The occasion 
proved so interesting and instructive that there 
was a general demand for its repetition in the 
year following, and the next, and so on until 
it has become an established event among trust 
company men throughout the country. The 
arrangements are under the direction of the 
Trust Company Section, which, however, makes 
no appropriation of funds towards the ex- 
penses, these being met by the subscriptions 
of the guests. From the first the scene of the 



Secretarial Duties 275 

banquets has been the famous Waldorf-Astoria 
Hotel. 

The Section has its office in New York with 
the American Bankers' Association, which occu- 
pies the twelfth floor of the Hanover Bank 
Building, with entrances at No. 11 Pine and 
No. 5 Nassau streets. In these spacious and 
refined quarters is to be found equipment in 
keeping with the importance and country-wide 
influence of the Association. The library is 
remarkably rich in its stores of financial and 
commercial literature. 

For some years the Secretary of the American 
Bankers' Association acted in like capacity for 
the Trust Company Section, until 1908, when 
Philip S. Babcock was elected Secretary. He 
had formerly been Vice-President of the Trust 
Company of America, and by his experience, 
courtesy, and tact has contributed much toward 
the continuous growth of the Section. Upon 
his resignation, in September, 191 6, Leroy A. 
Mershon, formerly Publicity Manager of the 
United States Mortgage & Trust Co., became 
Secretary. 



CHAPTER XIX 

PERSONNEL 

What has been narrated in the preceding 
chapters has of necessity been a recounting 
of events and developments almost entirely de- 
void of credit for the achievements of individ- 
uals. Had space permitted, the stories of the 
separate companies would have had woven in 
with them a record of the. names and something 
of the individual deeds of the host of men in 
public, professional, and business life through 
whose efforts each of these corporate successes 
have been accomplished. 

It seems fitting, therefore, to include a roster 
of trust company notables, other than the names 
of the presiding officers heretofore mentioned. 
With an occasional repetition of some few of the 
latter, and of the names of some of the very 
early founders, such a list is here presented. It 
276 



Men in Public Life 277 

is not offered as a complete collection of names, 
but will serve to illustrate how splendidly the 
trust companies have been manned and built 
up and safeguarded through all the years. The 
subjoined names are those of some persons who 
either as incorporators or directors of institu- 
tions, years ago or in our own times, have lent 
their time, their means, and their reputations 
to the upbuilding of one or more companies. 

First we have the Citizens Savings & Trust 
Company of Cleveland, presenting the distin- 
guished name of President James A. Garfield. 
Of Vice-Presidents there have been several 
trust company men, namely, Levi P. Morton, 
Adlai E. Stevenson, and James S. Sherman. 
Among members of Cabinets are found : William 
M. Evarts, Richard Olney, John Hay, Elihu 
Root, Robert Bacon, Philander C. Knox, Daniel 
Manning, Charles S. Fairchild, John G. Car- 
lisle, Lyman J. Gage, Leslie M. Shaw, William 
G. McAdoo, Robert T. Lincoln, Stephen B. 
Elkins, Daniel S. Lamont, Russell A. Alger, 
Judson Harmon, John W. Griggs, William F. 
Vilas, John Wanamaker, George von L. Meyer, 
William C. Whitney, Benjamin F. Tracy, 



278 Story of Trust Companies 

John D. Long, Paul Morton, Truman H. New- 
berry, David R. Francis, and Cornelius N. Bliss. 

The country's diplomatic service has been 
represented by a number of notables who at 
home have served on the boards of trust com- 
panies. Among these may be mentioned White- 
law Reid, William Walter Phelps, Joseph H. 
Choate, Myron T. Herrick, and Henry Morgen- 
thau. Many United States Senators' names 
have appeared on trust company directorates. 
A few names by way of example of this are: 
Marcus A. Hanna, Nelson W. Aldrich, William 
A. Clark, John Kean, Clarence W. Watson, 
and William Murray Crane. Comptrollers 
of the Currency have frequently served on trust 
company boards. Some of the names of these 
in recent years have been William L. Tren- 
holm, James H. Eckels, Charles G. Dawes, Law- 
rence 0. Murray, and John Skelton Williams. 
Occasionally military celebrities have lent 
their names to trust undertakings. As witness 
of this we find on the list: Generals Franz Sigel, 
James S. Wadsworth, Stewart L. Woodford, 
and Wager Swayne. 

An extended schedule might be made of 



Merchant Directors 279 

trust company connections on the part of 
governors of various States. As a single illus- 
tration of this, six of the chief executives of the 
Empire State are found to have had trust com- 
pany affiliations: Edwin D. Morgan, Samuel J. 
Tilden, Roswell P. Flower, Horace White, 
John A. Dix, and Martin H. Glynn. The same 
is true of mayors, and the list for New York 
City is made up of the names of Edward Cooper, 
William R. Grace, Abram S. Hewitt, Hugh 
J. Grant, William L. Strong, and William J. 
Gaynor. Among the names of the older mer- 
chants of New York, and some of the other 
large cities, such well-known persons are found 
to have had a place in various of the directorates 
as: John Jacob Astor, Peter Cooper, Moses 
Taylor, William E. Dodge, Marshall 0. Roberts, 
Eugene Kelly, Samuel D. Babcock, Charles 
L. Tiffany, Robert Hoe, Charles Scribner, 
William Steinway, William H. Appleton, Wil- 
liam H. Aspinwall, Jordan L. Mott, Abiel A. 
Low, William Turnbull, Eugene G. Blackford, 
Charles A. Schieren, William H. Macy, Morris 
K. Jesup, John S. Kennedy, Erastus Corning, 
and Marshall Field. 



280 Story of Trust Companies 

A casual search of lists of directors who have 
been prominent in the industrial affairs of later 
days reveals a number of names of well-known 
men. 

Standard Oil interests have been represented 
by William Rockefeller, Henry H. Rogers, 
Henry M. Flagler, Charles M. Pratt, Edward 
T. Bedford, and Orville T. Waring. 

Steel and allied interests comprise names like 
Henry C. Frick, Henry Phipps, Charles M. 
Schwab, Elbert H. Gary, Daniel G. Reid, 
Charles A. Deere, Hugh McMillan, John Ste- 
venson, Jr., Cyrus H. McCormick, F. N. Hoff- 
stott, and Cleveland H. Dodge. 

Among manufacturers of recent and current 
times are to be mentioned, Henry 0. Have- 
meyer, Theodore A. Havemeyer, Claus Spreck- 
els, John Arbuckle, Frederick G. Bourne, 
William Barbour, Marcellus Hartley, Eberhard 
Faber, Charles C. Coffin, George Crocker, 
George Westinghouse, Jr., Harrison E. Gawtry, 
George Eastman, James B. Duke, Samuel P. 
Colt, Charles H. Nettleton, Seth E. Thomas, 
Daniel M. Ferry, William Wrigley, Jr., Fred- 
erick E. Weyerhauser, Emerson McMillin, 



Transportation Heads 281 

Charles W. McCutchen, William Ziegler, John 
D. Larkin, Adolphus Busch, John F. Betz, 
William Disston, Albert A. Pope, Sidney W. 
Winslow, Edward Mallinckrodt, Joy Morton, 
and T. Coleman DuPont. 

In mercantile lines during recent years some 
names are : Alexander E. Orr, Francis H. Leggett, 
Thomas F. Vietor, William D. Sloane, William 
A. Jamison, Carl Schefer, Augustus D. Juilliard, 
Isidor Straus, Jesse I. Straus, Louis Stern, 
John J. Riker, Isaac H. Clothier, David Dows, 
Jr., Frank Tilford, Stephen Farrelly, Robert 
Olyphant, Frank W. Woolworth, Thomas B. 
Wanamaker, Edwin J. Berwind, Patrick Cud- 
ahy, J. Ogden Armour, Patrick A. Valentine, 
Levi Z. Leiter, Alexander H. Revell, A. Mont- 
gomery Ward, and E. C. Simmons. 

A search of trust company lists shows many 
notables in the field of transportation business. 
Some of these are, or have been : Cornelius Van- 
derbilt (the Commodore), William H. Vander- 
bilt, Daniel Drew, Robert Garrett, Austin 
Corbin, George M. Pullman, Samuel Sloan, 
John Taylor Johnston, Chauncey M. Depew, 
James J. Hill, Louis K. Hill, Stuyvesant Fish, 



282 Story of Trust Companies 

Collis P. Huntington, Edward H. Harriman, 
George J. Gould, Edwin Hawley, Robert 
Mather, George F. Baer, Alexander J. Cassatt, 
James McCrea, Samuel Rea, N. Parker Short- 
ridge, Sir William C. Van Home, Eben B. 
Thomas, Samuel Spencer, Leonor F. Loree, 
Arthur E. Stilwell, Sir Thomas G. Shaughnessy, 
Lucius Tuttle, Marvin Hughitt, Julius Krutt- 
schnitt, William H. Baldwin, Jr., Charles S. 
Mellen, Howard Elliott, Anthony N. Brady, 
Theodore P. Shonts, Russell Robb, William B. 
Leeds, Frank Trumbull, Edward P. Ripley, Ben- 
jamin F. Yoakum, William G. Besler, Henry 
Tatnall, Frank J. Gould, and Samuel Thomas. 

Cable, telegraph, and telephone business 
contributes a group of names, such as Cyrus 
W. Field, Henry L. Hotchkiss, Thomas T. 
Eckert, Robert C. Clowry, Clarence H. Mackay, 
Theodore N. Vail, and Union N. Bethell. 

Among life, fire, and marine insurance com- 
pany heads mention is to be made of Richard 
A. McCurdy, Charles A. Peabody, Henry B. 
Hyde, James H. Hyde, John A. McCall, George 
E. Ide, Elbridge G. Snow, John F. Dryden, 
Henry Evans, and Anton A. Raven. 



Professional Men 283 

The bench and bar have contributed these 
among other names: Charles P. Daly, Elbridge 
T. Gerry, Lispenard Stewart, Hugh J. Jewett, 
Charles Francis Adams, 2d, Charlton T. Lewis, 
Lewis Cass Ledyard, William Bayard Cutting, 
John W. Sterling, Frederic R. Coudert, Julien T. 
Davies, Joseph S. Auerbach, Paul D. Cravath, 
Henry W. De Forest, DeLancey Nicoll, Joseph 
Larocque, B. Aymar Sands, Frank R. Lawrence, 
George B. Case, and Frederick Geller. 

Journalism has been represented by names 
like Salem H. Wales, Oswald G. Villard, Frank 
A. Munsey, George Harvey, and William J. 
Arkell; mining business contributes names like 
Daniel Guggenheim, Isaac Guggenheim, and 
Adolph Lewisohn; among hotel managers well- 
known names in the trust company field have 
been George C. Boldt and James H. Breslin; 
even medicine and literature are dignified by 
the name of Dr. S. Weir Mitchell; and the 
eminent educator, Harry A. Garfield, has in 
the past been an interested participant in trust 
company operations. 

But beyond all these, the logical and essential 
class of men of whom might be expected ability 



284 Story of Trust Companies 

and discretion as honorary officers or directors 
has always been the country's private and cor- 
porate bankers. Of the class first named, 
coming from early days down to the present, 
mention is to be made of Russell Sage, Thomas 
Tileston, Shepherd Knapp, George S. Bow- 
doin, A. Gracie King, Edmund D. Randolph, 
Joseph W. Drexel, J. Pierpont Morgan, Sr., 
Charles Steele, Edward T. Stotesbury, George 
W. Perkins, Henry P. Davison, William H. 
Porter, August Belmont, Jacob H. Schiff, Mor- 
timer L. Schiff, Otto H. Kahn, Paul M. War- 
burg, Alexander Brown, John Crosby Brown, 
Charles D. Dickey, Thomas Maitland, George 
Coppell, James Speyer, Adrian Iselin, Jr., Isaac 
N. Seligman, Luther Kountze, Charles Lanier, 
Ernst Thalmann, Henry L. Higginson, Gardiner 
M. Lane, E. Rollins Morse, George C. Clark, 
Jr., Robert H. McCurdy, Arthur Turnbull, 
Oscar L. Gubelman, William L. Bull, James 
Talcott, Elverton R. Chapman, Evans R. Dick, 
Henry S. Redmond, Henry Rogers Winthrop, 
Grant B. Schley, Allen B. Forbes, Henry R. 
Ickelheimer, and James Imbrie. 

To these should be added a list of private 



Banker Directors 285 

capitalists such as: John S. Kennedy, William 
Waldorf Astor, Vincent Astor, Darius 0. Mills, 
Ogden Mills, W. Emlen Roosevelt, Thomas F. 
Ryan, George G. Haven, Robert W. Goelet, 
Cornelius Vanderbilt (the younger), Alfred G. 
Vanderbilt, Harry Payne Whitney, Edwin 
Gould, August Heckscher, Charles R. Flint, 
John D. Crimmins, H. Clay Pierce, Peter A. 
B. Widener, Clement A. Griscom, Thomas 
Dolan, Morton F. Plant, and Norman B. Ream. 
To enumerate the presidents and other offi- 
cials of national, state, and savings banks who 
have taken part in trust company activities 
would be a task of no small magnitude. It 
will be fitting, however, to show a few repre- 
sentative names, most of which will be readily 
recognized as being those of leaders in the realm 
of corporate banking. Without repeating the 
names of the original directors of the Bankers 
Trust Company, all of which were set forth 
in an earlier chapter of this volume, a partial 
list of New York bank presidents who have 
served on trust company directorates shows the 
names of James Stillman, Frank A. Vanderlip, 
Valentine P. Snyder, James S. Alexander, 



286 Story of Trust Companies 

William A. Nash, Walter E. Frew, George F. 
Baker, Francis L. Hine, Thomas W. Lamont, 
Henry W. Cannon, Dumont Clarke, Lewis L. 
Clarke, Richard Delafield, George G. Williams, 
Joseph B. Martindale, J. Edward Simmons, 
James T. Woodward, Robert M. Galloway, 
Phineas C. Lounsbury, Rollin P. Grant, Joseph 
C. Hendrix, Edward Townsend, John Harsen 
Rhoades, and Lewis E. Pierson. 

A similar, though correspondingly incomplete, 
list for Philadelphia reveals the names of James 
R. McAllister, Philip Doerr, Samuel S. Sharp, 
Harry B. Michener, C. Stuart Patterson, Levi 
S. Rue, William T. Elliott, Lewis R. Dick, 
James F. Sullivan, J. S. McCulloch, Edward A. 
Schmidt, and G. Colesberry Purves. 

In Chicago we find: James B. Forgan, David 
R. Forgan, George M. Reynolds, John C. Black, 
Helge A. Haugan, S. R. Flynn, William H. 
Brintnall, Edwin L. Wagner, Ernest A. Hamill, 
Leroy A. Goddard, and William A. Tilden. 

In Boston these names, among others, ap- 
pear: Robert F. Herrick, Andrew W. Preston, 
George W. Moses, Wilmot R. Evans, C. Minot 
Weld, Henry C. Jackson, Charles O. L. Dillo- 



The Modern Tendency 287 

way, William A. Gaston, and Eugene V. R. 
Thayer. 

All over the United States the tendency in 
recent years has been for bank presidents to 
affiliate themselves with the boards of directors 
of the trust companies. The list of names 
which points this fact would be incomplete with- 
out speaking of some representative bank 
executives in cities other than those already 
mentioned. A few of these follow: Michael 
F. Dooley, of Providence; Robert. C. Pruyn, of 
Albany; Robert L. Fryer, of Buffalo; George 
T. Smith, of Jersey City; William Scheerer, of 
Newark; Douglas H. Thomas, of Baltimore; 
Oliver J. Sands, of Richmond ; Robert J. Lowry, 
of Atlanta; T. H. Given, of Pittsburgh; Emory 
W. Clark, of Detroit; Fred Vogel, Jr., of Mil- 
waukee; F. M. Prince, of Minneapolis, Edwards 
Whitaker, of St. Louis; H. J. Alexander, of 
Denver; M. F. Backus, of Seattle; D. W. Twohy, 
of Spokane; William M. Ladd, of Portland, Ore- 
gon; Frank B. Anderson, of San Francisco; and 
J. M. Elliott, of Los Angeles. 



CHAPTER XX 

SUSPENSIONS AND FAILURES. CLEARING HOUSE 
ARRANGEMENTS. RECENT GROWTH 

Our story is to conclude with some account 
of the numbers and aggregate size of the com- 
panies everywhere during recent years. Before 
presenting these facts, however, and telling 
of the modern growth and general success of 
the companies as a class of institutions, some- 
thing ought properly to be related by way of 
showing the other side of the picture. 

In 1908, a compilation was made by "Brad- 
street's" of bank and trust company suspen- 
sions during the sixteen years from 1893 to 
1908, inclusive. This showed that the sus- 
pensions of 1893 numbered 598, as compared 
with only eighty-nine in the panic year of 1907 
(mostly from October on), and 132 in the course 
of the year 1908. 

288 



Failures 289 

Listed by the different classes of institutions 
the items and totals for the sixteen years were: 

National banks 359 

State banks 559 

Savings banks 167 

Private bankers 686 

Loan and trust companies 84 

A total of 1855 

On the face of this statement, it would ap- 
pear that the trust companies had been singu- 
larly free from insolvency troubles. But it 
should be remembered that they numbered 
considerably fewer than the banks and that 
whereas the savings banks which had suspended 
represented 93/iooths per cent, of all the insti- 
tutions of that class throughout the country, 
the element of trust company suspensions re- 
presented 70/iooths per cent, of the entire 
number, while the percentages of the state 
banks and national banks were only 61/iooths 
per cent, and 49/iooths per cent, respectively. 

Early in 191 1 a particularly disastrous failure 

occurred in New York City. This was when 

the Carnegie Trust Company at No. 115 

Broadway was closed by order of the State 

19 



290 Story of Trust Companies 

Superintendent of Banks. This concern had 
been permitted in 1907 to bear the honored 
name of the iron master of Pittsburgh, but Mr. 
Carnegie had never been upon the directorate 
and, when troubles overtook the Company, was 
interested only to the extent of considering 
plans whereby those difficulties might be 
averted. Appeals were made to him and to 
others at the close of 19 10, but internal condi- 
tions were too insecure and the institution, 
reported in the summer of that year as having 
over eleven and one half millions of dollars of 
resources, went to the wall and was never 
rehabilitated. 

Another suspension in New York, back in 
1904, was that of the Trust Company of the 
Republic, which became involved in difficulties 
connected with the unfortunate affairs of the 
11 Shipbuilding Company." A serious failure 
also occurred in 19 14 when the La Salle Street 
Trust & Savings Bank of Chicago was forced 
to suspend, carrying down with it a large num- 
ber of affiliated banks. The so-called Lorimer- 
Munday difficulties which began in the early 
spring of that year have made a series of tangles 



The Reserve Question 291 

which have continued to engage the attention of 
the courts even down to the time of this writing. 

Previous failures had taken place in 1903 
when the Federal Trust Company of Cleveland, 
a concern then two years old, got into difficulties; 
while in the same year the Union Trust Com- 
pany of Boston was forced to suspend. Gen- 
erally speaking, however, the record of solvency 
among these institutions has been as satis- 
factory as might be expected in a field in which 
such tremendous strides have been made within 
a short period of time. 

The greatest trust company problem of the 
past decade has certainly been the question of 
maintenance by them of proper cash reserves 
against deposits. Naturally this loomed large 
in the affairs of New York City financial ar- 
rangements. Until June 1, 1903, trust com- 
panies taking advantage of the privileges of 
the New York Clearing House had not been re- 
quired to carry such reserves against deposits. 
The matter was first made a sharp issue in 
April, 1902, by the action of the Clearing House 
Association in adopting a regulation to the 
effect that trust companies affiliated with it 



292 Story of Trust Companies 

should be called upon to maintain "such cash 
reserves on deposits as the Clearing House 
Committee may determine.' ' 

Much discussion in financial circles followed, 
from which it appeared that there was consider- 
able difference of opinion among the institutions 
concerned, some of them, such as the Title 
Guarantee & Trust Company, and the Van 
Norden Trust Company, declaring that the 
proposed regulation was just and necessary, 
and announcing that they had provided, of 
their own accord, for reserves approximating 
or equaling the fifteen per cent, reserve required 
of state banks. A few of the largest trust 
companies, on the other hand, asserted that 
the action of the Clearing House Association 
was unnecessary and officious, inasmuch as all 
conservative and successful companies did 
voluntarily provide their own reserves. The 
majority of the smaller companies appeared 
willing to abide by the eventual ruling of the 
Association; but on one point practically all 
the trust companies were agreed, namely, 
that there should be a distinction made between 
active and inactive accounts, that is, between 



Withdrawal from Clearing House 293 

accounts subject to check at sight and those 
designated trust funds or time deposits. It 
would be unwise and absurd, they argued, to 
withdraw from circulation so great an amount 
of money as would be represented by even a 
moderate reserve on funds which, of their 
nature, were virtually permanent or of long and 
fixed duration. It was contended further that the 
banks holding trust company deposits would be 
the real sufferers because of the withdrawals 
necessary to meet the requirements of reserves. 

The eagerly anticipated ruling of the Clearing 
House Association was announced on February 
II, 1903, and definitely required the establish- 
ment and maintenance by trust companies of 
a 5 per cent, cash reserve by June 1, 1903, of 
7>^ per cent, by February 1, 1904, and of 10 
per cent, after June 1, 1904. It became ap- 
parent at once that several of the most promi- 
nent trust companies would withdraw from the 
Clearing House, and for a time there seemed 
a likelihood that an independent clearing 
organization would be formed for the transac- 
tion of trust company business. This project, 
however, was finally abandoned as impractica- 



294 Story of Trust Companies 

ble, and upon the new reserve rule going into effect 
on June 1, 1903, it was found that seventeen trust 
companies continued to be represented at the 
Clearing House, and that these held in their 
vaults as a 5 per cent, cash reserve, §5,266,450, 
or about one fourth the amount which would 
have been required as reserves had the ten seced- 
ing trust companies also submitted to the rule. 

On February 1, 1904, the date on which the 7^ 
per cent, reserve requirement became effective, 
two or three additional companies retired rather 
than carry such a ''burdensome reserve," and on 
June 1, 1904, when the full 10 per cent, cash re- 
serve was required, so many further secessions 
had occurred that there remained only two trust 
companies of the twenty-seven that had been 
originally affiliated with the Clearing House. 

For about two years the trust companies 
were allowed to shape their own course, but 
on April 27, 1906, the first trust company reserve 
law ever enacted in New York went into effect. 
It required New York City companies to carry 
5 per cent, of deposits in cash, 5 per cent, in 
bank, and 5 per cent, in bonds, and appeared to 
work satisfactorily until the panic of 1907, when 



The Hughes Committee 295 

"over the count er" clearings, and want of a 
clearing organization, resulted in serious compli- 
cations. Early in 1908 the Legislature enacted 
the present reserve law which requires trust com- 
panies in Manhattan to carry, at all times, a cash 
reserve of 15 per cent, of all demand deposits. 

Back in 1907 a special committee of bankers 
had been appointed by Governor Hughes. In a 
report submitted by them in December of that 
year, it was stated that their deliberations had 
been to the end of determining " what, if any, 
changes are advisable in the law of the State 
relating to the incorporation, conduct, and super- 
vision of banks and trust companies." The 
personnel of the committee was partly repre- 
sentative of banks and partly of trust compa- 
nies. Its members were A. Barton Hepburn, 
Edwin S. Marston, Edward W. Sheldon, Alger- 
non S. Frissell, Stephen Baker, and Andrew 
Mills. Their findings were not at all harmoni- 
ous on the subject of what reserves ought to 
be maintained by the trust companies, and not 
until 191 1 were there signs of mutual overtures 
between these institutions and the management 
of the New York Clearing House. 



296 Story of Trust Companies 

On May 6th occurred the first annual dinner 
given by the trust companies. This took place 
at the Waldorf-Astoria, and it was evident, 
from the interchange of opinions between the 
six hundred bankers who attended, that a satis- 
factory settlement might be looked for. Three 
days later the Clearing House Committee acted, 
and, by almost unanimous vote, agreed to accept 
for full membership any trust company capital- 
ized at $1,000,000 or more, on condition that 
it carry the 15 per cent, reserve required by 
law and, further, that it maintain 10 per cent, 
of its deposits with a member bank. Of a total 
of forty- three trust companies, twenty-nine 
were eligible under the capitalization require- 
ment and, of these, eighteen were duly admitted 
to full membership, thus happily ending a 
controversy and estrangement which for nine 
years had been marked at times by extreme 
bitterness on both sides. 

On June 30, 19 16, the total deposits of the 
bank and trust company members of the New 
York Clearing House amounted to nearly 
three and one half billions of dollars. The 
portion of this representing holdings of trust 



Recent Progress 297 

company members was approximately one and 
one half billions of dollars, and it is not too 
much to claim that the full fellowship estab- 
lished five years earlier is now upon a footing 
of permanency and mutual advantage which 
will forever do away with the jealousies of years 
gone by. 

Everywhere during recent years there has 
been concentration in the numbers of com- 
panies through mergers and absorptions equal 
almost to the increase in new organizations. 
For example, from 1903 to 191 6 the number 
of companies in Greater New York has shown 
a net decrease from forty-seven to twenty-nine. 
Except for the two important suspensions pre- 
viously commented upon, and a few minor 
insolvencies, all of this contraction has been 
due to mergers, the greater number of which 
have been alluded to in the separate sketches 
of the New York companies. 

As to the numbers and size of all American 
companies, statistics since 1875, when Comp- 
troller Knox reported 35 concerns as compiled 
by him, exclusive of eight Chicago companies, 
had never been really complete until the advent 



298 Story of Trust Companies 

in 1903 of the United States Mortgage & 
Trust Company's annual book, Trust Companies 
of the United States. Previously, in 1889, the 
Comptroller's report mentioned 120 companies; 
in 1895 the American Bank Reporter showed 
that there were 569 with total resources of 962 
millions of dollars. On an earlier page of the 
present volume it has been shown that the 
Bankers Encyclopedia contained only 509 trust 
companies for the year 1896. Summaries 
shown in the United States Mortgage & 
Trust Company's book from 1903 to 19 15, 
inclusive, reveal the following remarkable totals: 



Year ended 


Number 


Total Resources in 


June 30th 


Millions of Dollars 


1903 


912 


2910 


1904 


994 


3138 


1905 


1115 


3802 


1906 


1304 


3944 


1907 


1480 


4221 


1908 


1470 


3917 


1909 


1504 


4610 


1910 


1527 


4610 


1911 


1616 


5168 


1912 


1579 


5490 


1913 


1732 


5475 


1914 


1812 


5924 


1915 


1777 


6328 




A Modern Building. Home of America's largest trust institution, the 

Guaranty Trust Company of New York. Southeast corner of 

Broadway and Liberty Street. 



A 1 9i 6 Aggregate 299 

An interesting article written by Clay Her- 
rickin the Bankers Magazine in 191 1 shows that 
on June 30th of that year there were 39 com- 
panies each reporting over $25,000,000 of re- 
sources and that there were no less than 165 
companies each of which had over $5,000,000 
of the same. The growth of five years past 
has, however, eclipsed over and again all pre- 
vious records. In the tabulation, which now 
follows, it is shown that as of June 30, 191 6, 
there were 52 companies having over $25,000,000 
of resources each, and that these with the 18 
other largest companies had, in the summer of 
1916, a grand total of $4,309,756,442.80 of 
resources. 

Here we will leave these and the host of 
other fiduciary concerns bearing the honored 
name of trust company. It would be idle to 
predict the possibilities of continued growth. 
Whatever this may show, it is not too much to 
claim on behalf of the trust companies of 191 6 
that generations to come, looking back, will 
say of some, if not all, of these modern money 
powers that, indeed, "there were giants in the 
earth in those days." 



300 Story of Trust Companies 



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302 Story of Trust Companies 





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304 Story of Trust Companies 





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APPENDIX B 
BIBLIOGRAPHY 

BOOKS AND MANUALS 

Trust Companies of the United States [Statements, 
Officers, Directors, etc., 1903 to 1916]. United 
States Mortgage & Trust Company, New- 
York. 

The Modern Trust Company. New York, 1906. 
F. B . Kirkbride and J. E. Sterrett. 

The Trust Company Idea and its Development. 
Toronto, 1904. Ernest Heaton. 

Trust Companies in the United States. Baltimore, 
1902. George Cator. 

Trust Companies, their Organization, Growth, and 
Management. New York, 1909. Clay 
Herrick. 

History of Banking in the United States. New York, 
1896. William Graham Sumner. 

Statutory Revision of Laws of New York Affecting 
Banks, Banking and Trust Companies, Enacted 
in 1892 and Amended 1893 and 1900. Andrew 
Hamilton. 

Digest of Trust Company Laws relating to Trust 
308 



Appendix B 309 

Companies of the United States. New York, 

1905. Benjamin J. Downer. 
Taxation of Trust Companies. Madison, Wis., 1906. 

Margaret Anna Schaffner. 
The Investment of Trust Funds. San Francisco, 

1909. Frank C. Mortimer. 
Legal Investments for Trust Funds. New York, 

1914. Frank C. McKinney. 
Forms for Trust Companies, Selected and Arranged 

by a Committee of the Trust Company Section. 

New York, 1910. 
The Rise and Business of the Modern Trust Company. 

Philadelphia, 1905. William P. Gest. 
The Trust Company Day by Day. Philadelphia, 

191 1. A. A. Jackson. 
The Problem of Wealth and the Trust Company as 

Trustee. San Francisco, 1903. Lyman J. 

Gage. 
The Management of Trust Property. Boston, 1914. 

The New England Trust Company. 
Concerning Wills. St. Louis. Mercantile Trust 

Company of St. Louis. 
Statement of the Growth and Present Status of Trust 

Companies in the United States. New York, 

1905. Edward T. Perine. 
American Trust Companies, their Growth and Present 

Wealth. New York, 1909. Edward T. Perine. 

PERIODICALS 

Trust Companies, Monthly Magazine, New York, 
1904 to 19.16. 



310 Story of Trust Companies 

Bankers Magazine, New York, 1846 to 1916. 

New York Evening "Post" — Saturday Financial 

Supplements. 1903 to 191 6. 
Banking Law Journal, New York. 
Commercial and Financial Chronicle, New York. 
United States Investor, New York. 
The Financier, New York. 
Review of Reviews, New York. 
The Nation, New York. 
Rand-McNally Bankers' Monthly. 
Service, St. Louis, Mississippi Valley Trust Co. 
Guaranty News, Guaranty Trust Co., New York. 

REPORTS AND BULLETINS 

American Bankers Association, Trust Company 
Section, Proceedings of Annual Meetings. 1895 
to 1916. 

American Bankers Association, Library Collection 
of card index references to Trust Company 
literature, and traveling loan collection on 
Trust Company subjects (available only to 
member institutions). 

National Monetary Commission. State Banks and 
Trust Companies since the Passage of the 
National Bank Act. Washington Government 
Printing Office, 191 1. George E. Barnett. 

Reports of Comptroller of the Currency. Washington 
1876 to 1916. 

New York State Banks' and Trust Companies' Spe- 
cial Committee. Report submitted to Governor 
Hughes, 1907. 



Appendix B 311 

Bulletins of the American Institute of Banking. 
Publications of the American Academy of Political 

and Social Science. 
Reports of Superintendents of Banks, various States. 

MONOGRAPHS 

A Sketch of the Pennsylvania Company for Insur- 
ances on Lives and Granting Annuities. Phila- 
delphia, 1896. Harrison S. Morris. 

One Hundredth Anniversary of the Pennsylvania 
Company for Insurances on Lives and Granting 
Annuities. Philadelphia, 191 2. 

Historical Sketch of the Essex Trust Company, Lynn, 
for its Centennial Year. 1 91 4. Ellen Mudge 

BURRILL. 

Memorandum of Seventy-five Years. Girard Trust 
Company. Philadelphia, 191 1. Edward 
Sydenham Page. 

The Fiftieth Anniversary of the Founding of the 
United States Trust Company of New York. 
1905. 

Fifty Years of Banking in Chicago. Merchants' 
Loan & Trust Company. Chicago, 1907. 
William Hudson Harper and Charles H. 
Ravell. 

Fifty Years. Philadelphia, 1865-1915. The Provi- 
dent Life & Trust Company. William S. 

ASHBROOK. 

Fidelity Trust Company. Philadelphia, 1866-19 16. 
Title Insurance and Trust Companies. Philadelphia 
1889. The Land Title & Trust Co. 



312 Story of Trust Companies 

Famous Title and Trust Companies. Lawyers 
Title Insurance & Trust Company. New York, 
1909. F. B. Vogel. 

Citizens Savings & Trust Company. Cleveland, 
1908. 

Old Colony Trust Company. Boston, 1915. 

State Street Events. Twenty-fifth Anniversary of 
the Founding of the State Street Trust Com- 
pany. Boston, 1916. 

An Epitome of the Past, A Chronicle of the Present, 
A Promise of the Future. The Cleveland Trust 
Company. Cleveland, 1908. 

Eighty-fifth Anniversary. Canal Bank & Trust 
Company. New Orleans, 191 6. 

Souvenir of Twenty-fifth Anniversary. The Me- 
chanics Trust Company of New Jersey. 
Bayonne, 191 1. 



INDEX 



Abbott, Gordon, 191 
Adams, Charles Francis, 2d, 

283 
Alabama Life Insurance & 

Trust Co., 71 
Albany Trust Co., 168 
Aldrich, Nelson W., 278 
Alexander, H. J., 287 

— James S., 285 
Alger, Russell A., 277 
Allen, Stephen, no 
Alley, Saul, 21 

American Bankers Associa- 
tion, 227, 263, 264, 266 

— Bible Society, The, 92, 94; 

United States Trust Co. 
Appointed Trustee, 92 

— Life Insurance & Trust 

Co., Baltimore, 29, 71 

— Trust & Savings Bank, 

Chicago, 188, 267 

— Trust Co., Boston, 259, 

260, 306 

— Trust Co., Cleveland, 267 
Anderson, Frank B., 287 
Andrus, George, 16 
Annual Reports by Referees 

of the Supreme Court, 

86-88 
Appleton, William H., 279 
Arbuckle, John, 280 
Arkell, William J., 283 
Armour, George, 105 

— J. Ogden, 281 
Ashbrook, William S., 311 



Aspinwall, William H., 279 
Assets, Auction Sale of, 89 
Astley, Thomas, 49 
Astor, John Jacob, 21, 112, 
279 

— Trust Co., New York, 239, 

240, 304 

— Vincent, 285 

— William Waldorf, 285 
Atlantic Cable, Opening of, 

106 

— Trust Co., 167 
Auerbach, Joseph S., 283 
Avery, M. N., 245 



B 



Babcock, Philip S., 267, 275 

— Samuel D., 279 
Backus, M. F., 287 
Bacon, Robert, 277 
Baer, George F., 282 
Bailey, Benjamin, 16 
Baker, Ezra H., 259 

— George F., 180, 197, 286 
— ■ Stephen, 223, 295 
Baldwin, LeRoy W., 220 

— William H., Jr., 282 
Baltimore Fire of 1904, 228, 

229 
Bancker, Charles N., 8 
Bangs, Francis S., 267 
Bank for Savings, 19 
" — Note Reporters," 102 

— of Commerce, 74 

— of New York, 29, 65 

— of North America, 1 



313 



314 



Index 



Bank of the State, The, Ohio, 

75 

— of the United States, 66 
Bankers Trust Co., 108, 222, 

227, 228, 268, 300 
Banking Convention, First 

Important, 64 
Banking System, Free, 66-68 
Banks, early criticism of, 34- 

36 

— Safety Fund, 66 

— Statistics of, 53-56 
Bannard, Otto T., 183, 184, 

264 
Barbour, William, 280 
Bard, William, 21, 31, no 
Barnes, George, 255 
Barnett, George E., 310 
Barry, William C, 254 
Bates, Dean Henry M., 272 
Bay State Trust Co., Boston, 

301 
Bayne, Samuel G., 223 
Bedford, Edward T., 280 
Belmont, August, 197, 284 
Bergen & Lafayette Trust 

Co., Jersey City, 256, 306 
Berwind, Edwin J., 281 
Besler, William G., 282 
Bethell, Union N., 282 
Betz, John F., 281 
Biddle, Nicholas, 61 
Binney, Horace, 48 
Black, John C, 286 
Blackford, Eugene G., 279 
Bliss, Cornelius N., 278 
Bloodgood, Abraham, 21 
Bohlen, John, 7 
Boisot, Emile K., 221 
Boldt, George C, 283 
Bond Companies, Early, 43 

— Edward P., 148 
Boody, Charles A., 258 
Booth, Willis, 187 
Borne, John E., 267 
Borough Bank of Brooklyn, 

234 . 



Boston Safe Deposit & Trust 

Co., 148-150, 306 
Bourne, Frederick G., 280 
Bowdoin, George S M 284 
Bowling Green Trust Co., 

New York, 217, 301 
Bowne, Walter, 21 
Bradley, Robert S., 238 
Brady, Anthony N., 282 
Breslin, James H., 283 
Bright, Louis V., 177 
Brintnall, William H., 286 
Broadway Trust Co., New 

York, 257, 305 
Bronson, Isaac, 21 
Brooklyn Bank, 234 

— Trust Co., 133, 134, 257, 

T, 303 

Brown, Alexander, 284 

— Cyrus P., 179 

— H. Martin, 179 

— John Crosby, 284 
Browne, N. B., 131 
Buckner, Mortimer N., 184 
Buffalo Trust Co., The, 75, 91 
Bull, William L., 284 
Burke, W. P., 210 

Burrill, Ellen Mudge, 311 
Busch, Adolphus, 281 
Butler, Benjamin F., 22 



Caldwell, Stephen A., 131 
California Safe Deposit & 

Trust Co., 230 
Cambreleng, C. C., 16 
Campbell, Felix, 258 
Campbell, James, 212 
Canal Bank & Trust Co., 

208-210, 247, 307, 312 
Cannon, Henry W., 286 
— James G., 223 
Carlisle, John G., 277 
Carnegie Trust Co., New 

York, 289, 290 
Carteret Trust Co., 256 



Index 



3i5 



Case, George B., 283 
Cassatt, Alexander J., 282 
Castles, John W., 123, 196, 

236, 247 
Cator, George, 308 
Centennial Exposition, 114 
Central Bank of Hatch & 

Langdon, 100 

— Trust Co. of Illinois, Chi- 

cago, 220, 221, 302 

— Trust Co., New York, 

108, 150-152, 301 
Champlin, John T., 16 
Chapman, Elverton R., 284 
Charleston Insurance & Trust 

Co., 70 
Chernical Bank, 29 
Chicago Fire of 1871, 104, 

145, 228 

— Title & Trust Co., 249, 

307 

Choate, Joseph H., 278 
Christensen, General C. T., 

133 

Citizens Bank (Smead, Col- 
lard & Hughes), 1 01 

— Savings & Trust Co., 

Cleveland, 139-143, 277, 
302, 312 
City Bank, New York, 23, 27 

— Trust & Banking Co., New 

York, 70 

— Trust Co., Boston, 301 

— Trust Co., New York, 217 
Claflin, John, 281 

Clark, Clarence H., 131 

— Emery W., 287 

— George C, Jr., 284 

— William A., 278 
Clarke, Dumont, 286 

— Lewis L., 286 
Claxton, John, 7 

Clearing House, New York, 
82, 227, 236 

— Admission of Trust Com- 

panies to Full Member- 
ship, 274, 296 



— Certificates, Issuance of, 

233 

— Forming of, 82 

— 19 16 Holdings of Trust 

Company Members, 296, 
297 

— Withdrawal of Trust Com- 

panies from, 293 
Cleveland Trust Co., 205- 

208, 268, 303, 312 
Clothier, Isaac H., 281 
Clowry, Robert C, 282 
Coffin, Charles C, 280 
Coggeshall, Edwin W., 177 
Colonial Trust & Savings 

Bank, Chicago, 302 

— Trust Co., New York, 217, 

219, 267 

— Trust Co., Pittsburgh, 252 

307 
Colt, Samuel P., 179, 280 
Columbia Finance & Trust 

Co., Louisville, 265 
Columbia Trust Co., New 

York, 238, 239, 267, 301 
Commerce Trust Co., Kansas 

City, 246, 247, 306 
Commercial Trust Co. of 

New Jersey, Jersey City, 

213, 214, 305 

— Trust Co., Philadelphia, 

253, 268, 305 
Committee of Public Safety, 

113 

Commonwealth Trust Co., 
Boston, 261, 306 

Continental & Commercial 
Trust & Savings Bank, 
Chicago, 188, 189, 303 

— Trust Co., Baltimore, 

228 

— Trust Co., New York, 183, 

264 
Converse, Edmund C, 223, 

225, 240 
Coolidge, T. Jefferson, Jr., 

189-191, 264 



3i6 



Index 



Cooper, Edward, 279 

— Peter, 83, 279 
Coppell, George, 284 
Corbin, Austin, 281 
Cornell, Robert C, 109 
Corning, Erastus, 83, 279 
Coudert, Frederic R., 283 
Cowles, J. G. W., 206 
Cox, Attila, 265 

Crane, William Murray, 278 
Cravath, Paul D., 283 
Crimmins, John D., 285 
Crocker, George, 280 
Cudahy, Patrick, 281 
Culbertson, Townley, 246 
Cumming, George M., 202 
Cutler, Ralph W., 268 
Cutting, William Bayard, 283 
Cuyler, Cornelius C, 202 

— Thomas De Witt, 253 



D 



Daly, Charles P., 283 
Davies, Julien T., 283 
Davison, Henry P., 223, 284 
Dawes, Charles G., 220, 278 
Dechert, Henry M., 265, 267 
Deere, Charles A., 280 
De Forest, Henry W., 283 
Delafield, Richard, 286 
Delavan, Edward C, 22 
Depew, Chauncey M., 281 
Deposits of Bank and Trust 
Company Members of 
New York Clearing 
House, 296, 297 
Dick, Evans R., 284 
— Lewis R., 286 
Dickey, Charles D., 284 
Digest of Trust Company 
Laws in the States and 
Territories, 273, 308 
Dilloway, Chas. O. L., 286 
Disston, William, 281 
Dix, John A., 168, 279 
Doane, J. W., 105 



Dod, S. Bayard, 256 
Dodge, Cleveland H., 280 

— William E., 279 
Doerr, Philip, 286 
Dolan, Thomas, 285 
Donnell, James J., 251 
Dooley, Michael F., 287 
Downer, Benjamin J., 309 
Dows, David, 123, 202 

— David, Jr., 281 
Drake, J. C, 245 
Drew, Daniel, 109, 281 
Drexel, Joseph W., 284 
Drum, John S., 244 
Dryden, John F., 282 
Du Bois, W. L., 144 
Dudley, Peter, 265 
Duer, John, 21 
Duke, James B., 280 
Dunham, J. H., 105 

Du Pont, T. Coleman, 281 
Dutilh, Charles, 112 
D'Wolf, James, Jr., 16 



Eastman, George, 280 
Eckels,' James H., 223, 278 
Eckert, Thomas T., 282 
Elkins, Stephen B., 277 
Elliott, Howard, 282 

— J. M.,287 

— Wm. T., 286 
Ellis, Rudulph, 131 
Empire Trust Co., New York, 

219, 220, 303 
Endicott, Wm., Jr., 143 
Equitable Trust Co., New 

York, 217-219, 301 
Erie Canal Trust & Banking 

Co. of Buffalo, The, 69 
Erringer, J. Livingston, 144 
Essex County Trust Co., 

East Orange, 178, 304 
Evans, Cadwallader, 7 

— Henry, 282 

— Wilmot R., 286 



Index 



3i7 



Evarts, Wm. M., 277 
Events, Early, 18-20, 32, 33 



F 



Faber, Eberhard, 280 

Failures, 237 

Fairchild, Charles S., 183, 277 

— Julian D., 258 
Fairfield Loan & Trust Co. 

of Connecticut, 61 
Farmers Fire Insurance & 

Loan Co. (see below) 
Farmers' Loan & Trust Co., 
The, New York, 11-17, 
19-21, 29, 32, 36-47, 58, 
71, 75, 91, 107-110, 121, 
301 
Farmers Trust Co. of Lan- 
caster, Pa., 2 
Farnam, Henry, 105 
Farrelly, Stephen, 281 
Federal Reserve Bank, 212, 

225, 260 
Federal Trust Co., Cleveland, 

250, 291 
Ferry, Daniel M., 280 
Fessenden, Russell G., 259 
Fidelity Title & Trust Co., 
Pittsburgh, 251, 252, 305 

— Trust_& Safety Vault Co., 

Louisville, 265 

— Trust Co., Newark, 304 

— Trust Co., Philadelphia, 

128-132, 177-179, 303, 
3ii 
Field, Cyrus W., 282 

— Marshall, 105, 279 

Fifth Avenue Trust Co., 
New York, 197, 300 

Fillmore, Millard, 67 

First National Bank, Brook- 
lyn, 233 

— Trust & Savings Bank, 

Chicago, 221, 222, 301 
Fish, Preserved, 65 



Fish, Stuyvesant, 281 
Fitzgerald, Louis, 226 
Flagler, Henry M., 280 
Flint, Charles R., 285 
Flower, Roswell P., 279 
Flynn, S. R., 286 
Forbes, Allan, 261 

— Allen B., 284 
Forgan, David R., 286 

— James B., 221, 286 
Francis, David R., 278 
Franklin, Thomas, 16 

— Trust Co., Brooklyn, 180- 

182, 264, 305 
Free Banking Act, 68, 69, 73 
" — Money Banks," 70 
Frew, Walter E., 286 
Frick, Henry C, 185, 280 
Fries, Col. F. H., 268 
Frissell, Algernon S., 295 
Frothingham, I. H., 122 

— Thomas, 253 
Fryer, Robert L., 287 
Fuller, Melville W., 106 

— Oliver C, 268 



Gage, Lyman J., 117, 272, 

277, 309 
Gallatin, Albert, 65 
Gallaway, Robert M., 286 
Gannon, John J., 247 
Garfield, Harry A., 283 

— James A., 140, 277 
Garrett, John B., 115 

— Robert, 281 

Garth, Granville W., 223 
Gary, Elbert H., 280 
Gaston, William A., 287 
Gates, Thos. S., 144 
Gawtry, Harrison E., 280 
Gaynor, William J., 259, 279 
Geller, Frederick, 283 
Georgia Insurance and Trust 
Co., 71 



3i8 



Index 



German-American Trust & 
Savings Bank, Los An- 
geles, 245, 246, 305 

Gerry, Elbridge T., 180, 283 

Gest, John B., 131 

— William P., 131, 309 

Gibson, F. B., 265 

Gill, John, of R., 252 

Girard Trust Co., Philadel- 
phia, 50-52, 76, 107, 
113-115, 267, 302 

Given, T. H., 287 
Glynn, Martin H., 279 
Goddard, Leroy A., 286 
Goelet, Robert, 123 

— Robert W., 285 

Goff, Frederick H., 206, 268 
Goodhue, Jonathan, 21 
Gould, Edwin, 285 

— Frank J., 282 

— George J., 282 
Grace, William R., 279 
Grant, Frederick D., 274 

— Hugh J., 279 

— Rollin P., 286 
Gratz, Hyman, 49 
Gray, Cyrus S., 251 
Griggs, John W., 277 
Griscom, Clement A., 285 
Griswold, George, 16 
Guaranty Trust Co., New 

York, 108, 195-200, 202, 
247, 300, 3io 
Guardian Savings & Trust 
Co., Cleveland, 250, 251, 
268, 304 

— Trust Co., New York, 

220, 303 
Gubelman, Oscar L., 284 
Guggenheim, Daniel, 283 

— Isaac, 283 

H 



Hamill, Ernest A., 286 
Hamilton, Andrew, 308 



Hamilton Trust Co., Boston, 

262 
Hanna, Marcus A., 278 
Hardenbergh, John W., 213 
Harison, Richard, 16 
Harmon, Judson, 277 
Harper, William Hudson, 311 
Harriman, Edward H., 282 
Harris, Albert W., 248 

— Edward, 254 

— Norman W., 248 

— Trust & Savings Bank, 

Chicago, 248, 249, 304 
Hart, Francis R., 191 
Hartford Trust Co., 268 
Hartley, Marcellus, 280 
Harvey, George, 283 
Haugan, Helge A., 286 
Havemeyer, Henry O., 280 

— Theodore A., 280 
Haven, George G., 235 
Hawley, Edwin, 282 
Hay, John, 140, 277 
Heaton, Ernest, 308 
Heckscher, August, 285 
Heebner, Samuel L., 144 
Hellman, Isaias W., 204 

— I. W., Jr., 204 

— M. S., 186 

Hemphill, Alexander J., 196 

— James, 8 

Henderson, Charles R M 202 
Hendricks, Francis, 255 
Hendrix, Joseph C, 286 
Hepburn, A. Barton, 223, 295 
Heppenheimer, General Wil- 
liam C, 256 

Herrick, Clay, 215, 299, 308 

— Myron T., 278 

— Robert F., 286 
Heurtley, Arthur, 265 
Hewitt, Abram S., 279 
Heyer, Cornelius, 65 
Hibernia Bank & Trust Co., 

New Orleans, 247, 306 
Hibernian Banking Associa- 
tion, Chicago, 249, 250 



Index 



3i9 



Higginson, Henry L., 284 
Hill, James J., 281 

— Louis K., 281 
Hillhouse, Thomas, 166, 168 
Hine, Francis L., 286 
Hinman, G. P., 86 
Hodenpyl, Anton G., 267 
Hoe, Robert, 279 
Hoffstott, F. N., 280 
Holiday, John H., 265 
Holland Purchase, 12 
Hone, Philip, 21 

Hooper, James R., 143 

— Wm., 101 

Hotchkiss, Henry L., 282 
Howard Trust & Banking 

Co., Troy, 70 
Hudson Trust Co., Hoboken, 

256, 306 
Hughes, Charles E., 310 

— Committee, 295 
Hughitt, Marvin, 282 
Hulbert, Edmund D., 105 
Hunt, Wilson G., 83 
Huntington, Collis P., 282 
Hyde, Henry B., 282 

— James H., 282 



Ickelheimer, Henry R., 284 

Ide, George E., 282 

Illinois Trust & Savings 
Bank, Chicago, 145, 146, 
301 

Imbrie, James, 284 

Industrial Trust Co., Provi- 
dence, 179, 180, 302 

International Trust Co., Den- 
ver, 265 

— Trust Co., New York, 

234 
Irby, W. R., 210 
Iselin, Adrian, Jr., 284 
Ives, General Brayton, 168 



Jackson, A. A., 267, 309 

— Henry C, 286 

— John B., 251 
James, William, 16, 21 
Jamison, William A., 281 
Janney, Nathaniel E., 176 
Jay, Peter Augustus, 21 

— Pierre, 272 
Jennings, E. H., 252 
Jersey City Trust Co., 305 
Jesup, Morris K., 279 
Jewett, Hugh J., 283 
Johnson, Edward, 258 

— Francis M., 149 
Johnston, John 16 

— John Taylor, 281 

Jones, Breckinridge, 193, 265, 
267, 269 

— Edward R., 21 
Jordan, Noah W., 259 
Juilliard, Augustus D., 281 

K 

Kahn, Otto H., 284 
Kean, John, 278 
Keep, Charles H., 238 
Kelly, Eugene, 279 
Kelsey, Clarence H., 169 
Kemper, W. T., 246 
Kennedy, John S., 152, 279, 

285 
Kent, James, 21 
Kerr, Walter, 11 1 
King, A. Gracie, 284 

— Edward, 123, 235 

— John, 182 

— Willard V., 238 

Kings County Trust Co., 
Brooklyn, 258, 259, 305 

Kinney, Thomas T., 178 

Kirkbride, F. B., 308 

Knapp, Shepherd, 83, 109, 284 

Knickerbocker Savings Insti- 
tution, 84 



320 



Index 



Knickerbocker Trust Com- 
pany, New York, 231, 
237, 238, 301 
Knower, Benjamin, 22 
Knox, John J., 53, 79, 161, 297 
— Philander C, 185, 277 
Kountze, Luther, 284 
Krech, Alvin W., 218 
Kruttschnitt, Julius, 282 



Ladd, William M., 287 
Lamont, Daniel S., 277 

— Thomas W., 286 

Land Title & Trust Co., 
Philadelphia, 172, 174- 
"176, 306, 311 
Landon, Charles G., 202 
Lane, Gardiner M., 284 
Lanier, Charles, 284 
Larkin, John D., 281 
Larocque, Joseph, 283 
La Salle Street Trust & Sav- 
ings Bank, Chicago, 290 
Lawrence, A. H., 16 

— Amos A., 143 

— Frank R., 283 

— Joseph, 83, 86 

— William B., 21 
Lawyers Title & Trust Co., 

New York, 176, 177, 304 
Leavitt, David, 76 
Ledyard, Lewis Cass, 283 
Leeds, William B., 282 
Leggett, Francis H., 281 
Leiter, Levi Z., 281 
Lenox, Robert, 21 
Lewis, Charlton T., 283 

— Gabriel L., 16 
Lewisohn, Adolph, 283 

Life Policy, Old "Farmers," 

46,47 
Lincoln, Robert T., 277 
Lincoln Trust Co., New York, 

232 

— Trust Co., St. Louis, 265 



Lloyd, Horatio G., 253 
Loasby, Arthur W., 255 
Lockport Bank & Trust Co., 

69, 70 
Logan, William, 223 
Long, John D., 278 
Long Island Loan & Trust 

Co., Brooklyn, 303 
Longstreth, Joshua, 7 
Longyear, W. D., 186 
Lord, David J., 262 
Loree, Leonor F., 282 
Lorillard, Peter, 21 
Los Angeles Trust & Savings 

Bank, 244, 245, 305 
Lounsbury, Phineas C, 286 
Low, Abiel A., 123, 180, 279, 

202 
Lowry, Robert J., 287 
Ludlow, Thomas W., 21 
Luhnow, Christian A., 216 

M 

McAdoo, William G., 277 
McAllister, Jas. R., 286 
McBride, James, 16 
McCall, John A., 282 

— Samuel W,, 272 
McCarter, Uzal H., 178 
McCormick, Cyrus H., 105, 

280 
McCrea, James, 282 
McCulloch, J. S., 286 
McCurdy, Richard A., 282 

— Robert H., 284 
McCutchen, Charles W., 281 
McEldowney, H. C, 186 
McGarrah, Gates W., 224 
Mcintosh, H. P., 250, 268 
Mclntyre, Archibald, 16 
McKean, J. S., 186 
McKinney, Frank C, 309 
McLucas, W. S., 246 
McMillan, Hugh, 280 
McMillin, Emerson, 280 
Mackay, Clarence H., 282 



Index 



321 



Mactier, Henry, 16 
Macy, William H., 279 
Magee, James, 16 
Maitland, Thomas, 284 
Mallinckrodt, Edward, 281 
Manhattan Company, Bank 
of the, 29, 30 

— Trust Co., New York, 226, 

300 
Manning, Daniel, 277 
Marshall, Benjamin, 16 
Marston, Edgar L., 224 

— Edwin S., 109, 236, 295 
Martindale, Joseph B., 286 
Mason, John H., 21, 268 
Mather, Robert, 282 

— Wm. G., 267 
Maynard, Edwin P., 133 
Mechanics Bank, 57 

— Trust Co. of New Jersey, 

Bayonne, 312 
Mellen, Charles S., 282 
Mellon, A. W., 184 
Menefee, R. C, 246 
Mercantile Trust & Deposit 

Co., Baltimore, 252, 253, 

306 

— Trust Co., New York, 

226, 300 

— Trust Co., St. Louis, 210- 

213, 267, 3<M> 309 

— Trust Co., San Francisco, 

230 

Merchants and Bankers Al- 
manac of 1 868, 137 

Merchants Exchange Co., 78, 

79 

— Loan & Trust Co., The, 

Chicago, 103-107, 117, 

302 
Meredith, William, 65 
Merrill, Edwin G., 123 
Mershon, Leroy A., 275 
Metropolitan Bank & Trust 

Co., Los Angeles, 244, 305 

— Trust & Savings Bank, 

Chicago, 221, 302 



Metropolitan Trust Co., New 

York, 166, 167, 302 
Meyer, George von L., 277 
Michener, Harry B., 286 
Michigan Trust Co., Grand 

Rapids, 267 
Miller, C. S., 48 

— Theodore F., 133 
Mills, Andrew, 295 

— Darius 0., 285 

— Ogden, 285 
Mississippi Valley Trust Co., 

St. Louis, 192-194, 264, 
265, 267, 304, 310 

Missouri-Lincoln Trust Co., 
St. Louis, 304 

Mitchell, John J., 146 

— Dr. S. Weir, 283 
Morgan, Edwin D., 166, 279 

— J. Pierpont, 152, 202, 232, 

236, 238, 284 

— J. P. & Co., 232 
Morgenthau, Henry, 278 
Morris, Calvary, 206 

— Effingham B., 115 

— Harrison S., 48, 311 
Morse, E. Rollins, 284 
Mortimer, Frank C, 309 
Morton, Joy, 281 

— Levi P., 180, 197, 277 

— Paul, 278 

— Trust Co., New York, 197, 

300 
Moses, George W., 286 
Mott, Jordan L., 279 
Mumford, George S., 262 
Munsey, Frank A., 283 
Murray, Lawrence O., 278 
Murtha, William H., 258 
Mutual Life Insurance Co., 

The, 80 

N 

Nash, William A, 286 
National Bank of Commerce, 
New York, 231 



322 



Index 



National Banking Act, 103 

— City Bank, New York, 56, 

57 

— Safety & Trust Co., 76 
Nettleton, Charles H., 280 
Newberry, Truman H., 278 
Newbold, George, 65 

New Brunswick Trust Co., 

N. J., 178, 304 
Newcomb, H. R., 143 
New England Trust Co., 
\ Boston, 143, 144, 305, 

309 

Newton Trust Co., N. J., 
178,304 

New York Life Insurance & 
Trust Co., 18-31, 40-42, 
58, 65, 71, 75, 80, 91, 
107, 110-112, 304 

— Security & Trust Co., 

The, 183 

— Trust Co., The, 183, 184, 

301 
-— Trust & Banking Co., 

74 
Nicholson, William R., 176 
Nicoll, De Lancey, 283 
Norcross, Otis, 143 
North American Trust & 

Banking Co., 69, 74, 

— Trust Co., 217 
Northern Trust Co., Chicago, 

247, 248, 264, 303 
Norton, D. Z., 143 



Oakley, Thomas J., 22 
Oakman, Walter G., 196 
Ohio Life Insurance & Trust 
Co., 29, 58-60, 74, 75, 
95-100 
Olcott, Frederic P., 150, 151 
Old Colony Trust Co., Bos- 
ton, 189-192, 264, 301, 
312 



Olney, Richard, 277 
Olyphant, Robert, 281 
Orr, Alexander E., 197, 281 



Packard, C. S. W., 112 

— Edwin, 182, 196 

Page, Edward Sydenham, 

3ii 
Panic, of 18 19, 10 

— of 1837,33,63,64,81 

— of 1857, 97, 98, 99, 101, 

102 

— of 1873, 146, 147, 148 

— Of I893, 201 

— of 1907, 231-236; Govern- 

ment Relief Plan, 234; 
Statement of Comp- 
troller of the Currency, 

235 

Parish, Henry, no 
Paul, Henry N., 112 
Patterson, C. Stuart, 286 
Paul Revere Trust Co., 260 
Payne, Henry B., 140 
Peabody, Charles A., 282 

— S. Endicott, 259 

Peace, Joseph, 7 

Pennsylvania Co. for Insur- 
ances on Lives and Grant- 
ing Annuities, The Phila- 
delphia, 2, 4-9, 48-50, 
76, 107, 112, 113, 303, 

311 

People's Safe Deposit & 
Trust Co., Jersey City, 
256, 306 

— Trust Co., Brooklyn, 257, 

258, 304 
Perine, Edward T., 203, 309 
Perkins, George W., 224, 284 
Phelps, Dudley B., 255 

— John J., 83 

— William Walter, 278 
Philadelphia Trust Co., 144, 

304 



Index 



323 



Phipps, Henry, 280 
Pierce, H. Clay, 285 
Pierson, Lewis E., 286 
Plant, Morton F. f 285 
Platten, John W., 202 
Poillon, William C, 226, 268 
Political Events, Early, 3-5, 

10, 18, 19 
Pope, Albert A., 281 
Porter, William H., 224, 284 
Post, A. H. S., 252 
Potter, Edwin A., 188, 267 
Pratt, Charles M., 280 
Preston, Andrew W., 286 
Prime, Nathaniel, 21 
Prince, F. M., 287 
Prosser, Seward, 225 
Provident Life & Trust Co., 

Philadelphia, 124-127, 

301 
Pruyn, Robert C, 287 
Pullman, George M., 105, 

281 
Purves, G. Colesberry, 286 
Putnam, William E., 150 



Raguet, Condy, 8 
Randolph, Edmund D., 284 
Ransom, Frederick H., 145 

— S. W., 145 
Ravell, Charles H., 311 
Raven, Anton A., 282 
Rea, Samuel, 282 

Real Estate Title & Trust 

Co., Chicago, 307 
Ream, Norman B., 285 
Red Bank Trust Company, 

178 
Redmond, Henry S., 284 
Reid, Daniel G., 224, 280 

— Whitelaw, 278 
Remsen, Peter, 21 
Reserves, Trust Company, 

291-296 
Revell, Alexander H., 281 



Reynolds, George M. f 188, 

250, 286 
Rhoades, John Harsen, 286 
— Joshua, 252 
Rhode Island Hospital Trust 

Co., Providence, 134, 

135, 164, 302 
Richards, Benjamin W., 51, 

Richardson, Charles, 175 
Richmond # Trust & Safe 

Deposit Co., 267 
Ridgway, Thomas, 115 
Riker, John J., 281 
Riley, Harrison B., 249 
Ripley, Edward P., 282 
Robb, Russell, 282 
Robberies, 129, 130 
Roberts, Marshall O., 279 
Rochester Trust & Safe De- 
posit Co., 253, 306 
Rockefeller, William, 280 
Rogers, Henry. H., 280 
Rogerson, Charles E., 150 
Rolston, Rosewell G., 109 
Roosevelt, W. Emlen, 285 
Root, Elihu, 277 
Ropes, Ripley, 133 
Rue, Levi S., 286 
Russel, William W., 16 
Ryan, Thomas F., 180, 285 



Sabin, Charles H., 196 
Safe Deposit & Trust Co., 

Baltimore, 228 
— ■ California, 230 
Sage, Russell, 122, 284 
St. Louis Trust Co., 265 
Saltus, Francis, 16 
Sands, B. Aymar, 283 
— Oliver J., 287 
San Francisco Fire of 1906, 

229, 230 
Sartori, J. F., 186 
I Satterlee, Herbert L., 238 



324 



Index 



Savings & Loan Society, San 
Francisco, 243 

— Union Bank & Trust Co., 

San Francisco, 243, 244, 

303 
Scarborough, W. W., 101 
S chaff ner, Margaret Anna, 

309 
Scheerer, Win., 287 
Schefer, Carl, 281 
Schell, Christian, 16 
Schieren, Charles A., 279 
Schiff, Jacob H. f 180, 284 

— Mortimer L., 284 
Schlatter, William, 8 
Schley, Grant B., 284 
Schmidlapp, J. G., 251 
Schmidt, Edward A., 286 
Schwab, Charles M., 280 
Scribner, Charles, 279 
Security Title & Trust Co., 

Chicago, 265 

— Trust & Savings Bank, 

Los Angeles, 186-188, 
302 

— Trust Co. of Rochester, 

254, 307 
Seligman, Isaac N., 284 
Sellers, Frank H., 265 
Sergeant, John, 48 
Seymour, Henry, 46 
Sharp, Samuel S., 286 
Shaughnessy, Sir Thomas G., 

282 
Shaw, G. B., 188 

— Leslie M., 277 
Sheldon, Edward W., 117, 

236, 295 
Sherman, James S., 277 
Shipley, Samuel R., 126 
Shoemaker, Jacob, 8 
Shonts, Theodore P., 282 
Shortridge, N. Parker, 282 
Sigel, Franz, 278 
Simmons, E. C, 281 

— J. Edward, 286 
Skelding, Francis H., 224 



Sloan, Samuel, 281 
Sloane, William D., 281 
Smith, Charles Emory, 272 

— Byron L., 248 

— George T., 287 

— J. Moreau, 254 

— Orson, 105 

— Solomon A., 105, 248 

— V. Moreau, 254 
Smyth, Lindley, 112 
Snow, Elbridge G., 282 
Snyder, Valentine P., 285 
Southard, George H., 182, 264 
Southern Life Insurance & 

Trust Co., St. Augustine, 
60, 61, 71 

— Trust Co., Los Angeles, 

302 
Spaulding, Henry F., 150 
Specie Payments Suspended, 

10, 63, 65, 102, 237 
Spencer, Samuel, 282 
Sperry, Jacob, 7 
Speyer, James, 284 
Spreckels, Claus, 280 
Standard Trust Co., New 

York, 300 
State Ban k s, Growth of, 79 

— Street Trust Co., Boston, 

260-261, 305, 312 

— Trust Co., Xew York, 267 
Steele, Charles, 284 

Stein way, William, 279 
Sterling, John W., 283 
Stern, Louis, 281 
Sterrett, J. E., 308 
Stetson, C., 98 
Stevenson, Adlai E., 277 

— John, Jr., 280 

Stewart, John A., 84, 86, 116 

— Lispenard, 283 
Stickney, George E., 189 
Stillman, James, 180, 285 
Stilwell, Arthur E., 282 
Stites, John, 265 
Stockton, Philip, 191 

I Stone, Frederick M., 149 



Index 



325 



Storm, Garrit, 22 
Stotesbury, Edward T., 284 
Straus, Isidor, 281 
— Jesse I., 281 
Strong, Benjamin, Jr., 225 
Strong, William L., 279 
Sullivan, James F., 286 
Sumner, William Graham, 

3?8 
Superintendent of Banks, 
Office Established at Al- 
bany, 75 
Suspensions and Failures, 

288-290 
Swayne, Wager, 278 
Swinney, Edward F., 224 



Taft, Wm. H., 274 
Talcott, James, 284 
Tallmadge, James, 16 
Tatnall, Henry, 282 
Taylor, Moses, 109, 279 

— Roland L., 144 

Testamentary Trusts, Not- 
able, 106, 132, 133, 142, 
194, 212, 258 

Thalmann, Ernst, 284 
Thayer, Eugene V. R., 287 
Thomas, Douglas H., 287 

— Eben B., 282 

— Samuel, 282 

— Seth E., 280 _ 
Thompson, David, no 

— John, 99 

— John F., 224 

— Samuel, 21 
Tierney, Myles, 256 
Tiffany, Charles L., 279 
Tilden, Samuel J., 279 

— William, A., 286 
Tileston, Thomas, 109, 284 
Tilford, Frank, 281 
Tilley, John D., 265 

Title Guarantee & Trust Co., 



New York, 169-172, 265, 

292, 302 
Title Insurance & Trust Co., 

Philadelphia, 267 
Tompkins, C, 265 
Townsend, Edward M., 286 

— Isaiah, 21 

— John R., no 

— Thomas S., 16 
Tracy, Benjamin F., 277 

— Frederick A., 16 
Tradesmen's Bank, 65 
Trenholm, William L., 278 
Trumbull, Frank, 282 
Trust and Banking Co., 

Troy, 70 

Trust & Deposit Co. of Onon- 
daga, Syracuse, 255, 307 

Trust Companies, Chart of, 
1907, 215 

— Earliest Reports, 28 

— Early Decisions on, 84, 85 

— First Reliable Statistics of, 

153, 161-164 

— Reports of Federal Comp- 

troller, 159, 160, 165 

— Reports on, Ordered by 

State Senate, 90 

— State Superintendent's Re- 

port (1874), 158, 161 

— State Supervision of, 153- 

158 

— Stability of (1893), 201 

— Statistics (since 1875), 

297-299 

— Suspensions of, 147 
Trust Companies, Forms for, 

273, 309 
Trust Companies of the 

United States, 203, 242, 

298, 308 
Trust Companies — Magazine, 

216, 228 
Trust Company Committee, 

New York, 235-237 

— Figures, Bankers Encyclo- 

pedia (1896), 200 



326 



Index 



Trust Company, Functions, 
118-121, 208 

— Plan in Other Countries, 

240, 241 

— Section, 263-275; Presi- 

dents and Meeting 
Places, 267, 268 

— Proceedings, 271 

— Suspensions, 235 

— of America, 217, 232, 267, 

301 

— of New Jersey, Hoboken, 

256, 306 

— of the Republic, New York, 

290 
Tuckerman, Charles S., 189 
Turnbull, Arthur, 202, 284 

— William, 279 
Tuttle, Lucius, 282 
Twohy, D. N., 287 
Tyrell, John, 105 



U 



Union Bank & Trust Co., of 
New London, Conn., 2 

— County Trust Co., Eliza- 

beth, 178, 304 

— Savings Bank & Trust 

Co., Cincinnati, 251, 306 
Union Trust Co., Boston, 291 

— Chicago, 144, 304 

— Indianapolis, 265 

— New York, 122-124, 247, 

301 

— Pittsburgh, 184-186, 301 

— Providence, 235 

— St. Louis, 265 

— San Francisco, 204, 205, 

305 
United States, Bank of the, 25, 
28, 57, 64; Second, 33, 61 

— Bank of Pennsylvania, 61- 

63 

— Mortgage & Trust Co., 

New York, 202-204, 264, 
301, 308 



United States Trust and 

Banking Co., 69 
— Trust Co., 80, 82-92, 107, 
116, 117, 302, 311 



Vail, Theodore N., 282 
Valentine, Patrick A., 281 
Vanderbilt, Alfred G., 285 

— Commodore Cornelius, 

109, 123, 281 

— Cornelius, 285 

— Frederick, W., 197 

— William H., 123, 281 
Vanderlip, Frank A., 285 
Van Home, Sir William C, 

282 
Van Norden Trust Co., 292 
Van Rensselaer, Stephen, 21 
Van Tuyl, George C, Jr., 168 
Verplanck, Gulian C, 21 
Viele, John L., 16 
Vietor, Thomas F., 281 
Vilas, William F., 277 
Villard, Oswald G., 283 
Vogel, F. B., 312 

— Fred, Jr., 287 

W 

Wachovia Loan & Trust Co., 
Winston-Salem, N. C, 
268 

Wade, Festus J., 210, 267 

— Jeptha H., 140, 143 
Wads worth, James S., 123, 

278 
Wagner, Edwin L., 286 
Wales, Salem H., 283 
"Wall Street Chorus, The," 

72 
Wallace, James N., 151, 236 
Walmsley, R. M., 209 
Walsh, Julius S., 193 
Wanamaker, John, 277 

— Thomas B., 281 



Index 



327 



Warburg, Paul M., 284 
Ward, A. Montgomery, 281 
Warder, Jeremiah, Jr., 7 
Waring, Orville T., 280 
Washburn, W. J., 187 
Washington Trust Co., Wes- 
terly, R. I., 2 
Waterbury, John I., 226, 236 
Watson, Clarence W., 278 

— James S., 254 

— Robert C, 254 
Weld, C. Minot, 286 
Wells, Herbert J., 136 
Welsch, John, 8 
Westinghouse, George, Jr., 

280 
Weyerhauser, Frederick E., 

280 
Wheaton, Henry, 16 
Whitaker, Edwards, 287 
White, David, 16 

— Horace, 279 
Whitelaw, John F., 250 
Whitney, David R., 143 

— Harry Payne, 285 

— Stephen, 22 

— William C, 277 
Widener, Peter A. B., 285 
Wiggin, Albert H., 224 
Wigglesworth, George, 143 
Williams, Clark, 267 

— George, G., 286 

— John Skelton, 267, 278 

— Micajah T., 58 

— Moses, 261 



Williamsburg Trust Co., 234 
Williamson, Dow D., 109 
Willis, H. Parker, 273 
Windsor Trust Co., New 

York, 220, 303 
Wing, Asa S., 127 
Winslow, Sidney W., 281 
Winsor, Robert, 224 
Winthrop, Henry Rogers, 284 
Wisconsin Trust & Security 

Co., Milwaukee, 268 
Woerheide, A. A. B., 265 
Wood, Arthur King, 182 
Woodbury, Levi, 53 
Woodford, Stewart L., 278 
Woods, Dr. W. S., 246 
Woodward, James T., 286 
Woolverton, Samuel, 224 1 
Wool worth, Frank W., 281 
Worthington, George, 140 
Wright, Clifford B., 251 
Wrigley, William, Jr., 280 



Yoakum, Benjamin F., 282 
Yorke, Samuel, 7 
Young, Edward F. C, 224 
— George W., 202, 264 



Ziegler, William, 281 



A History of Modern 
Banks of Issue 

By 
Charles A. Conant 

Author of " Wall Street and the Country," etc 

S°. 5th Edition, Revised and Enlarged. $3.50 

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but with the history and actual experience of 
this great agency of industrial progress." — 
Chicago Eve, Post 

" We can only express our hearty appreci- 
ation of the book as a whole. It is extremely 
interesting. It cannot but be useful, and to 
us it is very cheering. Mr. Conant's book, 
from beginning to end, is a proof that sound 
currency is evolved necessarily from the 
progress of an 'industrial and commercial 
people.' "—AT, Y, Times, 

G. P. Putnam's Sons 

New York London 



Capital To=Bay 

A Study of Recent Economic Development 

By Herman Cahn 

12°. $1.50 

The following study has been written with 
special reference to the present economic 
situation in the United States, the essential 
features of which have been developed since 
the Civil War. But as the law underlying 
the capitalist mode of production and its 
tendencies are the same everywhere, such 
special reference to one country partakes of 
the character of an illustration of conditions 
obtaining or shaping themselves to-day in all 
advanced industrial countries. 

The most momentous developments during 
this period are the centralization of control 
of capital and the modification of the money 
system. The latter is by far the more por- 
tentous. Yet it is the former which occupies 
public attention, while silence reigns concern- 
ing the menacing money question. 

Partial List of Contents 
Economics a Science— Marxian Theory of 
Value Briefly Stated — Functions of Money — 
The Handicaps of the Money System — 
Money Tokens — Money of Account — Totality 
of Money System in U. S. — The Cycle of In- 
dustrial Capital— The Mystery of Capitalism 
— Fictitious Capital — The Concentration of 
Industrial Capital — The Concentration of 
Money Capital — Unified Capital. 

G. P. Putnam's Sons 

New York London 



A Brief History 
of Panics 

And their Periodical Occurrence in the 
United States 

By Clement Juglar 

Translated, Edited, and with an Introduction 

By DeCourcy W. Thom 

12°. $1.00 

This third edition of a decidedly im- 
portant work has received a valuable 
addition in the material by DeCourcy W. 
Thorn, former member of the Baltimore 
Stock Exchange and of the N. Y. Con- 
solidated Exchange, which brings the 
book from 1889 down to date, 

G. P. Putnam's Sons 

New York London 



! 



The 

Theory and History 

of Banking 

By Charles F. Dunbar 

Revised, Enlarged, and Brought to Date by 

0. M. Sprague 

This important volume by the late 
Professor of Political Economy in Har- 
vard University was first published in 
1891. At the time of the author's death, 
in 1900, he was engaged in revising 
and enlarging the work. The comple- 
tion was intrusted to Mr. Sprague, and 
a second edition appeared in 1901. 
Over 25,000 copies have been sold. 
Mr. Sprague has revised and brought 
this third edition down to date. 

G. P. Putnam's Sons 

New York London 

JRD 44 
















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